Economy against Covid-19

“The Path of the Economy Will Follow the Course of the Virus”

posted in: News | 0

Many headlines are impacting markets this week: A new stimulus plan, stricter lock downs across Europe, encouraging earnings, weak economic data and tame wholesale inflation.

Incoming president-elect Joe Biden unveiled a $1.9T stimulus plan last week. The proposal seeks direct checks of $1,400 for most Americans, enhanced unemployment insurance of $400 a week, money for schools to reopen, a possible $15 nationwide minimum wage along with aid for state and local communities. Stocks are mixed after this news came out.

The Fed has stated time and time again, “the path of the economy will follow the course of the virus”. At the moment, cases and deaths are at the highest level since the pandemic began. The country is struggling with the vaccine roll out. We need stimulus, but we also need to have economies reopened. Stimulus does not help a business that can’t open – nor do many of the measures in the proposed stimulus bill like a hike to minimum wages or money for schools.

Headlines from Europe invoking stricter lock downs due to COVID-19 as U.S. officials warn of a full resurgence in major population centers. One thing is for sure – it is one year later and we still don’t seem to know all we need to about this virus. There are four vaccines expected by March.

Earnings seasons unofficially kicked off today with JPMorgan Chase and Citigroup beating estimates while Wells Fargo was short on revenues. Retail Sales fell more than expected in December as did Empire Manufacturing. Wholesale inflation was tame last month and the data had little impact on the markets.

Fed Chairman Jerome Powell spoke last week and said the Fed will let the world know when they are looking to taper or stop asset purchases or bond-buying. They are not tapering anytime soon. There may be even more rate relief to come as recent history has shown us.

If you have questions about the volatility in the marketplace and how best to position your money, reach out to us today.

 

Courtesy of Mortgage Market Guide 

-CHECK US OUT ON SOCIAL-

Facebook

Twitter

YouTube

LinkedIn

Yelp