Week Ending December 11, 2020
Stimulus failure… Gomer Pyle always said it best, “Surprise, Surprise, Surprise”. Well, it should not be. Certain members of Congress have denied a more targeted new stimulus package to businesses, employees, and the private sector.
What does it mean – Small business is under attack. Certain members of Congress refuse to protect business owners from liability caused by the Coronavirus. Ask yourself, “Why is congress against liability protection for restaurants and small businesses?” Why are they continuing to play politics with peoples lives? Why is government protected? The hypocrisy continues. Government leaders and employees continue getting paid without risk to their pensions, salaries, and benefits. Where is the outrage from the taxpayer?
Initial jobless claims hit 853,000… States shutdown or severely limit small businesses.
What does it mean – Companies are forced to lay off employees as restaurants, gyms, hotels, and small businesses are forced to shut down by local and state government. Will congress stop the bickering and reach a deal on stimulus before they go on holiday? I don’t know but we can’t afford Trillions and we need to be targeted.
Q3 Productivity… Strong third quarter but facing huge head winds.
What does it mean – The third quarter had a huge bounce back from the pandemic and forced shutdowns. Now that several states, particularly CA, NJ, NY and MI are shutting down again, the slowdown and holiday season may be very difficult. The good news is the big box stores are deemed essential and Amazon is open for business. HMMMM.
University of Michigan Consumer Sentiment… Preliminary December report shows a rise of the University of Michigan Consumer Sentiment report to 81.4 from 76.9 in November but still 18% below the same period one year ago.
What does it mean – With job losses increasing, and Congress still bickering over fiscal stimulus, there is latent potential for a downward revision with the final reading.
New home sales decreased in November… For the month of October sales totaled 999,000, yet the average price jumped 1.6% to $386,200.
What does it mean – Demand for new homes is strong. Inventory is limited and pushing prices up. While interest rates remain low, pricing is getting a bit out of whack. Not to mention the concern for people who are losing their jobs due to mandatory shutdowns.
On a personal note… Small businesses are essential. They provide the lion share of opportunity and jobs to our citizens. They are the creators and entrepreneurs. They take significant risk chasing their dreams. And today, face overwhelming expenses to stay open and suffer under the hands of a government unsure and without knowledge or faith in people to make great decisions for themselves.
I know this might be late, but I believe it is a great idea to help support the local companies in your area.
At De Groote Financial, we gave a significant special bonus this year to all that decided to spend the money at a local restaurant, store, or locally owned business. The idea was to encourage our team to spend money locally in their community, on whatever they or their family needed, or however they wanted to spend it. All they had to do was show proof of purchase and we immediately reimbursed them for the expense.
This went a long way to helping our employees and the local economy.
Have a great week all,
Doug De Groote, CFP®, MBA, CTC