December 2020 – Monthly Outlook – “Extraordinarily Uncertain”

Get ready for a wild December:  Virus surging, possible vaccines, budget fights, stimulus proposals, and a final vote in the Electoral College.

Federal Reserve Chairman Powell testified today to the Senate that the economic recovery outlook is “extraordinarily uncertain”.  The job market is starting to show signs of slowing, with 20 million folks still receiving some form of government benefits.

Small business are closing at an alarming rate – and these figures are as of the end of September, before the most recent surge in virus cases.  In the seven months from Feb. 29 to Sep. 30, 163,735 U.S. businesses have closed their doors, including 97,966 businesses (60%) that are likely closed for good (Source: Yelp Economic Average, BTN Research). Small business owners have more economic uncertainty than in the last 20 years.

The immediate concern is December 11th, when Congress needs to pass legislation to fund the government.  Congress also needs to pass additional stimulus to support the economy until the Biden administration is inaugurated on January 20, 2021. I am confident they will get something done on the government funding but remain skeptical on additional stimulus.  All of the safety nets from the original CARES Act (extended unemployment benefits, eviction and mortgage foreclosure moratoriums, student loan interest relief, etc.) expire on December 31st.  The longer it takes to get more stimulus into the system the bigger the risk to the economic recovery.

On the positive side, recent news about potential vaccines give me hope that we are going to begin to see a more normal world in 2021.  Below are some estimates on vaccine distribution and the impact on global economic activity.

We continue to monitor economic and financial market conditions and will adjust your portfolio as needed.  We expect the market to be volatile but range bound throughout December.

P.S. Thank you for your referrals. They are making a big difference in my practice. Feel free to share my name with your friends on Facebook or LinkedIn.   Thank you to Vic & Carol C. for referring friends and Dave P. for having us help his daughters.

December Calendar of Events   (comments and additions for future months are always welcome)

  • December is Universal Human Rights Day.  Let’s pray that all people, regardless of race, religion, gender, or nationality  can learn to treat others as we all wish to be treated.

December 10th            Human Rights Day   –  I have cherished the ideal  of a democratic and free society… it is an ideal for which I am prepared to die. – Nelson Mandela

December 10th            Happy Hanukkah  –    May it be a festival of love, happiness, success, and health in your world now and always.

December 15th            Healthcare open enrollment – for coverage starting Jan 1, 2020 – ENDS!   

December 19th            Christian’s birthday

December 21st Winter Solstice    –       The shortest day of the year and the start of winter

December 25th            Merry Christmas – have a wonderful holiday.  Let’s all remember the true significance of this day – the birth of Christ. 

December 26th            Kwanzaa starts – let’s all celebrate African-American culture

Best regards,

Jim

Sources: Blackstone, CNBC, Bespoke Investments

Although information herein has been obtained from sources deemed reliable, its accuracy and completeness are not asserted. All opinions and estimates included in this report constitute the judgment of the financial advisor as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

Investing involves risk and you may incur a profit or a loss. Diversification does not ensure a profit or ensure against a loss. There is no assurance that any investment strategy will be successful.  Past performance is no assurance of future results.

Please consider the charges, risks, expenses and investment objectives carefully before investing. Please see a prospectus containing this and other information. Read it carefully before you invest or send money.

Information provided should not be construed as legal or tax advice.  You should discuss any tax or legal matter with the appropriate professional.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s