Commentary

The Greatest Possible Stimulus

After receiving the genetic sequence of the novel coronavirus from China, it took Moderna just two days (two days!!) to generate the sequence of the vaccine. In less than a month, they produced the first clinical batch of the mRNA-1273 vaccine that has now seen tens of millions of doses distributed.

Commentary

Overstimulation on the Way

Things are looking up for the US economy. Later this week we'll get an update on real GDP growth for the 4th quarter of 2020. We estimate that'll be revised up to a 4.3% annual rate of growth from a prior estimate of 4.0%.

Commentary

It's Not a Bubble

Ever since the stock market bottomed in 2009 during the financial crisis, people have been coming up with reasons why the bull market was about to end. We heard every reason – Brexit, the end of Quantitative Easing, too much debt, COVID, etc. – and while we understood each may be a cause for consternation, we focused on valuations, which suggested the bull market would continue. Over time, math wins.

Commentary

Immunity is Closer Than You Think

While the US has been a focus for criticism throughout the COVID-19 pandemic, its vaccine rollout has so far been the envy of the world. Since Operation Warp Speed eliminated many of the bureaucratic hurdles to FDA approval and helped deliver a vaccine in record time, the US has been steadily growing its distribution system.

Commentary

The Return of Inflation

Inflation is not dead. It is not gone. It has not been tamed. We know it seems like it, especially after the past few decades which generated in many an "inflation-complacency" that feels justified. After all, following the 2008 Financial Panic, many predicted Quantitative Easing would cause hyper-inflation.

Commentary

AOC and Ted Cruz, Agree!

Yes, 2021 is starting off as crazy as 2020. They don't agree on the Green New Deal, or Socialism, but Ted Cruz and AOC both agree that limiting investor access to markets is a mistake. In case you missed it, last week, Robinhood, a new online trading platform that marketed itself as democratizing investment, stopped investors from buying certain stocks.

Commentary

Watching and Waiting

Beyond the annual rotation of voting members on the Federal Open Markets Committee (FOMC), there wasn't change in today's Fed statement. While acknowledging the moderation in some recent economic data, and that weakness is concentrated in areas most directly impacted by the pandemic...

Commentary

Can Massive Deficits Really Be Financed?

The budget deficit for fiscal year 2020, which ended 9/30/2020, was $3.1 trillion, the highest ever on record in dollar terms, and the highest relative to GDP since World War II. This year the deficit will be even larger.

Commentary

Growth Continued in Q4

The double-dip recession so many feared didn't arrive in the fourth quarter of 2020, and it certainly doesn't look like it will happen in early 2021, either.

Commentary

Elections Have Tax Consequences

The seemingly endless election of 2020 is finally over, with Democrats winning both Senate seats in Georgia.

Commentary

Keeping Good State Policies

When it comes to attracting people, jobs, and businesses, some states are just better than others. While the total US population increased 6.5% from 2010 to 2020, it increased 17.1% in Utah, 16.3% in Texas, 16.3% in Idaho, 16.1% in Nevada, 15.8% in Arizona, and 15.3% in Florida.

Commentary

Inflation, Debt, MMT, and Bitcoin

We can't possibly exhaust our thoughts on all these topics in one Monday Morning Outlook, but we thought we'd give it the old college try.

Commentary

Greedy Innkeeper or Generous Capitalist?

The Bible story of the virgin birth is at the center of much of the holiday cheer this time of year. The book of Luke tells us that Mary and Joseph traveled to Bethlehem because Caesar Augustus decreed a census should be taken. Mary gave birth after arriving in Bethlehem and placed baby Jesus in a manger because there was "no room for them in the inn."

Commentary

Eyes on the Horizon

Nobody expected to see a rate change from this week's FOMC meetings, but interest remained high as the market awaited the latest Fed forecasts on where they see the US economy headed from here.

Commentary

Stimulus, Bailouts, and the Fed

Back room deals in Washington, DC always die and come back to life, over and over, again. And, even though a "COVID-shutdown rescue package" seems like a no brainer, it's been caught up in politics for months.