Missouri Minute: Bullard resists negative rates; Steak ‘n Shake closes 57 restaurants

Good morning, MBA readers,

Reopening of businesses temporarily closed by the COVID-19 pandemic continues across the state. Many malls and shopping centers in the Kansas City area are opening their doors this week, and a chamber of commerce survey of several dozen businesses in the area suggests the majority will be back in the office by June 1. But that comes amid continued concern about the potential spread of the coronavirus. A leaked White House report included Kansas City on a list of “locations to watch” due to increasing case rates, and the city’s top health official said more resources are needed to fight the pandemic. Of course, not all businesses shuttered in recent weeks will survive to reopen. The parent company of Steak ‘n Shake, for instance, announced 57 locations across the country will close permanently due to the coronavirus — potentially affecting some of the burger chain’s locations across Missouri.


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US deficit balloons to record $738 billion
The Treasury Department said Tuesday that the U.S. government recorded a $738 billion budget deficit in April due to the COVID-19 pandemic, which greatly expanded government spending while slashing tax revenue. The previous record for U.S. deficit in any month was $235 billion in February. (Reuters)

Report shows greatest drop in US consumer prices since Great Recession
The consumer price index fell 0.8% last month amid the coronavirus, marking the largest overall drop in prices since December 2008, the Labor Department said Tuesday. Gasoline prices dropped 20.6% in April after a 10.5% drop in March, while prices for food consumed at home ticked up 2.6%, the largest jump in that category since 1974. (Reuters)

Bullard pushes back against negative interest rate
St. Louis Federal Reserve Bank President James Bullard on Tuesday spoke against setting negative interest rates in response to the recent economic rout, arguing that such a move could disrupt short-term funding markets. Instead, he suggested that rates will remain at zero “for quite a while.” (St. Louis Post-Dispatch)

Feds flag KC as a place to watch for growing COVID cases
Federal health officials included Kansas City on a list of “locations to watch” due to its rate of new coronavirus cases, according to a newly uncovered document. Kansas City’s top health official on Tuesday expressed frustration that the information had not been shared with local officials. (NBC News, Kansas City Star)

St. Louis issues plan for reopening next week
The city of St. Louis will reopen businesses starting Monday with social distancing rules in place, such as having customers wait for appointments in their cars, limiting elevators to three passengers and encouraging a reservation-only system for dine-in restaurant service. (St. Louis Business Journal)

KC Chamber poll suggests most office workers will be back by June 1
The Greater Kansas City Chamber of Commerce polled its board members and found that 41% of their companies are planning to bring workers back to the office on June 1. That’s in addition to 36% that never closed or will reopen before June 1. About 91% said they planned to bring workers back in tiers to minimize potential spread of COVID-19. (Kansas City Business Journal)

Numbers point to slight improvement for St. Louis hotels
Revenue per available room — a key metric for hotels — in the St. Louis area was down 76.7% at the end of April compared to 85.2% at the beginning of the month, according to global hotel research firm STR. (St. Louis Business Journal)

KC malls carefully reopening
Shopping centers and malls across the metro area are reopening this week. Most have restricted hours and all are encouraging shoppers to stay home if they are feeling unwell. (Kansas City Star)

Restaurants lobby to make to-go cocktails permanent
The National Restaurant Association has called on Missouri lawmakers to extend new rules allowing restaurants to sell mixed alcoholic drinks to go. The practice, previously restricted under state law, was temporarily permitted in response to the pandemic. That order is set to expire in mid-June. (St. Louis Post-Dispatch)

Union cautions against resuming transit fares in St. Louis
Metro Transit plans to resume collecting bus fares in June. The union representing the bus drivers opposes the move, saying it puts drivers and riders at risk of spreading the coronavirus. (St. Louis Public Radio)


Say that again

“Celia is a hero who went in to work every day to serve the public good. In response, she was refused life-saving PPE by her employer and contracted a fatal case of coronavirus.”

That’s Kansas City attorney Brent Welder in a Tuesday release filed on behalf of the family of Celia Yap-Banago. Yap-Banago was a nurse at Kansas City’s Research Medical Center for 40 years before dying from COVID-19 in late April, the Kansas City Business Journal reports. Her family is filing a claim for death benefits under Missouri workers’ compensation laws. The family says she was made responsible for caring for a patient infected with the coronavirus in late March without adequate personal protective equipment, despite voicing concern to her supervisors. A hospital spokesperson said the company is expecting a swift resolution.


Go figure

57

That’s how many Steak ‘n Shake locations were closed permanently across the nation during the first quarter due to losses related to the coronavirus, the Indianapolis Business Journal reports. Food sales in the first quarter were down 41% from the year before, requiring the temporary closure of 62 restaurants, including some of the nearly 60 locations in Missouri listed on Steak ‘n Shake’s website. It is not clear at this point which stores are closed for good.


Hello, my name is

Matt Woods

He’s the Columbia-based attorney who filed a motion in Boone County Circuit Court to block the reopening order issued by the county’s health director, Stephanie Browning. Woods represents a group of business owners who say the order, which calls for a gradual reopening, is unconstitutional and overreaching, the Columbia Missourian reports. Woods said the motion for an injunction was all he could do after business owners’ requests to hold a meeting with Browning were met with no response. He said Columbia is not experiencing a COVID-19 emergency, with only five active cases on record as of Monday in a county of more than 180,000 people.


It’s been a pleasure doing business with you this morning.


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