Coronavirus (COVID-19)

[SlevinKelevra]

11 minutes ago, vikesfan89 said:

Why does the USPS need a bailout because of Corona virus?

1) because in 2005 (or so?) Congress passed a law requiring them to fully prefund retirement and healthcare benefits  75 years forward.  So a big chunk of every $ they take in today HAS TO BE set aside for retiree benefits in the year 2095.

2)

they are not allowed to operate at a profit to begin with

3)

mail volume is down by 40% or so

 

it isn't hard to understand unless you're trolling.

but enjoy the cost of everything you buy on amazon going up by $10+ or more when USPS can no longer do last-mile delivery for USPS and FedEx.

 

[vikesfan89]

1 minute ago, SlevinKelevra said:

1) because in 2005 (or so?) Congress passed a law requiring them to fully prefund retirement and healthcare benefits  75 years forward.  So a big chunk of every $ they take in today HAS TO BE set aside for retiree benefits in the year 2095.

2)

they are not allowed to operate at a profit to begin with

3)

mail volume is down by 40% or so

 

it isn't hard to understand unless you're trolling.

but enjoy the cost of everything you buy on amazon going up by $10+ or more when USPS can no longer do last-mile delivery for USPS and FedEx.

 

Not sure why you included the first 2 since that has nothing to do with the pandemic.

Is 3 since the pandemic started or since a different time?

[vikesfan89]

Maybe the government should mail all the stimulus checks so the postal service could get a little extra stimulus

[TwoUpTwoDown]

Just now, vikesfan89 said:

Not sure why you included the first 2 since that has nothing to do with the pandemic.

Is 3 since the pandemic started or since a different time?

He included the first sentence because if mail is down 40% they make roughly 40% less money which #1 obviously depends on.

Not sure about #2, but I think it means they never have a surplus of capital? Not good it they have no "savings" to depend on.

[SlevinKelevra]

8 minutes ago, vikesfan89 said:

Not sure why you included the first 2 since that has nothing to do with the pandemic.

Is 3 since the pandemic started or since a different time?

 

I'm making these # up for convenience.

 

You HAVE TO put $1B a month into the 2095 fund by law.

You set your service price points assuming 10B pieces of mail at net revenue neutral (revenue neutral by law).

You now send 6B pieces of mail and still have to put $1B into the fund next month.

 

It's basically like this

1) You signed a 100 year apartment lease that can not be broken or revoked.  Rent is due every month.

2) Your job pay rate is set such that it covers rent, food, utilities. Nothing else.  AND... you are not allowed (legally) to have another job.

3) Your job just cut your hours by 40%

 

 

 

Edited April 12, 2020 by SlevinKelevra
fixed 600M to 6B

[vikesfan89]

1 minute ago, TwoUpTwoDown said:

He included the first sentence because if mail is down 40% they make roughly 40% less money which #1 obviously depends on.

Not sure about #2, but I think it means they never have a surplus of capital? Not good it they have no "savings" to depend on.

I don't need a break down of where the money goes. That's a pre existing problem. I didn't know that mail was down that much.

The postal service has a lot more problems than the virus. I just wasn't sure if it was an add in or if they were hurting because of the pandemic

[SlevinKelevra]

1 minute ago, vikesfan89 said:

I don't need a break down of where the money goes. That's a pre existing problem. I didn't know that mail was down that much.

The postal service has a lot more problems than the virus. I just wasn't sure if it was an add in or if they were hurting because of the pandemic

also factor in that they won't be handling several million pieces of customer "tax" mail in April like usual , so that $ stream (sales of postal money orders) is off the table too

 

 

[vikesfan89]

4 minutes ago, SlevinKelevra said:

 

I'm making these # up for convenience.

 

You HAVE TO put $1B a month into the 2095 fund by law.

You set your service price points assuming 10B pieces of mail at net revenue neutral (revenue neutral by law).

You now send 6B pieces of mail and still have to put $1B into the fund next month.

 

It's basically like this

1) You signed a 100 year apartment lease that can not be broken or revoked.  Rent is due every month.

2) Your job pay rate is set such that it covers rent, food, utilities. Nothing else.  AND... you are not allowed (legally) to have another job.

3) Your job just cut your hours by 40%

 

 

 

What happens if they lay people off? Wouldn't that lower retirement obligations?

I always thought the USPS was subsidised already. 

[vikesfan89]

Just now, SlevinKelevra said:

also factor in that they won't be handling several million pieces of customer "tax" mail in April like usual , so that $ stream (sales of postal money orders) is off the table too

 

 

Shouldn't they be able to raise the cost of stamps now or can they only do that after they see the yearly numbers?

Obviously that wouldn't be a real quick fix but I wouldn't be surprised if the numbers don't come back all of the way after this is done

[SlevinKelevra]

Just now, vikesfan89 said:

What happens if they lay people off? Wouldn't that lower retirement obligations?

I always thought the USPS was subsidised already. 

they are not subsidized except in the case of extreme emergency or  if you view the idea of "public streets" they operate on as being paid by the taxpayer or the gas price they use being supplied under-cost by the military budget which the taxpayer eats.

 

sure they could lay people off, and then they couldn't fulfill their contractual obligations "yes customer, we have this priority mail service that is 2-3 days,  except umm.. that's actually 17 days based on when the workers handle that route".    And like I said, they do last-mile for USPS and FedEx in over 95% of the square miles of the country, so amazon/etc shipments would all be 3-7 days slower.   Further,

 

 

ps, most of the 2095 benefits obligations do not apply to the currently employed.  Our median death age in this country is nowhere close to 93 (the youngest a retiree could be in that year)

 

[SlevinKelevra]

5 minutes ago, vikesfan89 said:

Shouldn't they be able to raise the cost of stamps now or can they only do that after they see the yearly numbers?

Obviously that wouldn't be a real quick fix but I wouldn't be surprised if the numbers don't come back all of the way after this is done

I am not certain, but I would think they operate on the same fiscal calendar as the federal government.

That doesn't mean they have to implement price changes on Oct 1,  but I think the approval session by their board of governers (or whatever it is called) is usually held in early October.

 

they are also probably paying significantly higher prices for cargo since the volume of flights is down more significantly than the volume of mail

 

Edited April 12, 2020 by SlevinKelevra

[acowboys62]

18 hours ago, Xenos said:

Too bad we never saw the UK carry through with their herd immunity strategy to see what would have happened.....

Being somewhat sarcastic with the above comment. But I think your post speaks more to the infrastructural weaknesses we have in place in the USA than it does to the actual virus. Besides the income problem, we also have a healthcare issue with a lot of people right now. All this virus has done is show our fragile our current set up is. And with that being said, I'm going to end it there since I don't want this to get too political.

I agree on the infrastructure part.  This country really needs a lot of upgrades in a lot of areas...unfortunately for most of us, those topics are just noise when it comes for things to get done.  Hopefully this changes that but we shall see. 

 

[acowboys62]

16 hours ago, Xenos said:

2) I agree about the $1200 check not being able to sustain anyone. Not to mention the point of the $1200 was to get people to spend again and stimulate the economy. I doubt that happens. People are more likely to save that check than use it. Personally, I much prefer the more aggressive House bill. But what's done is done. The more important aspects of that bill is the unemployment insurance, and the billions going to small business and specific large corporations. My wife's work, for example, needs to have those small business loans to continue to remain open. Hopefully they find a way to improve the application process soon. It's still being overwhelmed. Additionally, this won't be the final bill when it comes to aiding this nation's most vulnerable people.

 

She having any luck?  My step father and his business partner have had zero luck so far at any of their current banking relationships.  Seems like the process is an absolutely mess. I get some exposure to this from the bank side because of my job but truthfully I have not paid attention to a lot of it as it is 99% just "corporate speak" in our calls and I am over that nonsense.  

[vikesfan89]

11 minutes ago, SlevinKelevra said:

they are not subsidized except in the case of extreme emergency or  if you view the idea of "public streets" they operate on as being paid by the taxpayer or the gas price they use being supplied under-cost by the military budget which the taxpayer eats.

 

sure they could lay people off, and then they couldn't fulfill their contractual obligations "yes customer, we have this priority mail service that is 2-3 days,  except umm.. that's actually 17 days based on when the workers handle that route".    And like I said, they do last-mile for USPS and FedEx in over 95% of the square miles of the country, so amazon/etc shipments would all be 3-7 days slower.   Further,

 

 

ps, most of the 2095 benefits obligations do not apply to the currently employed.  Our median death age in this country is nowhere close to 93 (the youngest a retiree could be in that year)

 

I don't mean mass layoffs but with that much less mail I'd assume there is places where not as much man power is needed. The government is trying to prevent layoffs in other business so it does seem to make sense to help out the USPS also.

Then they need to work on the messed up laws

[acowboys62]

4 hours ago, candyman93 said:

I’m starting to worry about the logistical nightmares that could happen from the next several months.
 

Tornado season just started and hurricane season starts in 2 months. How are you going to relocate and move hundreds of thousands of people during a pandemic?

Some of the talks with some of our Borrowers has been the potential conversion of hotels in "hot spot" areas to convert into temp. housing in those situations.  It is a tough situation as they need ramp up time and funds to accomplish that and would be unfair to expect the owner to cover that but also slow if they were to be funded through that and it may never actually be needed (hopefully).