The U.S. recession, which officially began in February, probably ended in April or May. Technically, that means we are in recovery. But for many, it sure doesn’t feel that way. Millions of Americans are unemployed or worrying that they’ll become unemployed when Payment Protection Program funds and enhanced unemployment benefits run out. Employment and retail sales improved more than expected in May, but they aren’t even close to where they were in January, before the recession hit like a sledgehammer. In the words of Neil Irwin, “The fabric of the economy has been ripped.” The economic hole is horrific and it will take a long time and copious amounts of fiscal and monetary policy stimulus to dig out of it. Two huge risks remain – new, catastrophic waves of the virus could occur; and fiscal and monetary policy support could prove inadequate. Either would slow recovery and extend pain for many. In this month’s letter, Maryland Smith’s Bill Longbrake also discusses the difference between traditional macroeconomic policy tools and modern monetary theory (MMT).