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
Sources: Blackstone, CNBC, Bespoke Investments
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