January 13, 2021
Besides the Capitol Hill chaos last week and the worsening coronavirus outbreak in America, a forecast released by the Centre for Economics and Business Research last month projected that China would overtake the U.S. as the world’s largest economy in dollar terms in 2028, five years earlier than a year ago.
“Stripping out the wild monthly swings of the coronavirus recession, the rise in layoff activity is historically large and surpasses the increases seen at the height of the Great Recession.”
“Much of the optimism for eventual recovery this year is tied to a successful and widespread vaccination program. One of the most substantial risks to the outlook is a significant delay or disruption…It is difficult to imagine a sustained and robust recovery until the virus no longer interferes with day to day decisionmaking.”
Even before the pandemic hit, the U.S. economy was in much worse shape than the low unemployment rate suggested. Almost all the income gains of the past several decades had gone to the wealthiest tenth of the population, leaving the bottom half hardly better off.
“That’s going to be a significant boost in their income…For people who work for Congress or people who work in policy, we can easily forget just how little money some people have.”
Rental income actually started declining in the fourth quarter of 2019, before anyone knew about COVID-19. So, there may be more to the story here than the pandemic.
It’s unclear whether investors believe gun manufacturers will benefit from Trump supporters purchasing weapons, general concern among other Americans about civil unrest, both or other reasons.
“The recovery is directly linked to the pace of vaccinations and its effectiveness both in terms of numbers, but also in terms of the confidence it instills in consumers.”
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