Week Ending January 22, 2021
Inauguration… The 46th President of the United States, Joseph R. Biden Jr., was sworn in on January 20th.
What does it mean – We hope and pray for all of our elected officials, that they put aside the politics and put America first. We might not agree on how, but the why should be self-evident and easy to understand.
Executive orders – President Biden wasted little time to issue the most executive orders ever by a president in the first week. Based on the executive orders signed, we will see energy prices rise and lose over 50,000 jobs directly related to the Keystone Pipeline, and many more in the supporting areas and states that support the massive project. These orders will reduce energy independence and increase energy prices for all Americans.
Massive increase in regulations due to the firings at the NLRB and CFPB. Expect to see an increase in costs for businesses that will trickle down to all consumers.
Open borders and defunding or halting the build-out of the border wall will cost taxpayers over $700 million to get out of $3 billion in contracts to build the wall. Not to mention we will be opening the flood gates to more Covid-19 cases, as more people flood our border illegally. This is also a direct conflict with the USMCA agreement that has benefited American companies and manufacturing throughout the United States.
These are just a few of the executive orders that will impact American workers and American businesses. This all comes at a time when many of our citizens are struggling to recover from the lockdowns imposed by many states and the federal government.
Initial unemployment claims… Consensus was 845,000, we came in at 900,000 initial unemployment claims.
What does it mean – The trend continues to reverse course. We had been moving in the right direction up until November when states like CA, NJ, NY, IL, and MA started to lockdown again.
Consumer confidence increases… The Conference Board’s Consumer Confidence Index increased to 89.3 in January.
What does it mean – The report highlights that the optimism about the short-term outlook is outweighing a weakening view about current business and labor markets.
Fed is full speed ahead… Fed Chair Powell makes it very clear for a case for more fiscal stimulus and is not going to raise interest rates or back down on its asset purchase plans.
What does it mean – The Fed is all in. Pedal to the metal in terms of MBS asset purchases of at least $120 billion per month and no increase in interest rates for the near future.
WOW, don’t read anything into this!!! World Health Organization (WHO) changes how we test for COVID-19 one hour after the inauguration. The World Health Organization changed its protocol for COVID-19 tests, which will result in large reductions in the number of positive cases.
What does it mean – Let’s get back to work, but don’t stop washing your hands. The great news is we are about to open up the economy. Even NY, NJ, and CA governors are getting the message from their citizens. With this new protocol from the WHO, governors are once again allowed to change or shift their metrics on how they measure and how they will open up their states. Governor Newsom of CA just announced the end of the stay-at-home order and is gearing up to let businesses start to reopen.
Have a great week all,
Doug De Groote, CFP®, MBA, CTC