Is it big? Yes. Is it bold? Yes. And we can get it done.

President Joe Biden on the American Jobs Plan

Fact Check: these are all true.

At the Carpenters Pittsburgh Training Center, President Biden formally announced his $2 trillion plus “American Jobs Plan” (AJP) targeted at increasing growth in jobs for the US economy. This is not merely an infrastructure plan, but truly a wide ranging spending plan covering a gamut of goodies areas outside of roads, bridges and tunnels. Candidate Biden proposed many of these during the campaign and is following through on those promises. Unlike the…

Yesterday, the European Union released a sweeping 30-year plan to achieve net zero and reshape the economy. This has broad implications for every EU sector. The plan also has implications for the world including the United States infrastructure plans.

The EU plan includes carbon pricing as the key component to placing a cost on emissions. The Emissions Trading Scheme or ETS is a revamp of the previously ineffective 2005 carbon market. The pay forces large emitters, like power generators and steel makers, to buy credits to cover the cost of their carbon production. The new plan broadens the scope of…

How Sen. Joe Manchin now controls the US Senate and the Federal Reserve

(All the research articles’ urls used to create this are at the end)

Let’s do a quick run through two topics impacting the economy and markets.

Federal Reserve monetary policy. On Wednesday, the Fed left interest rates and monetary policy unchanged. This was not a surprise. (Statement and Presser)What did change was the members’ expectations on inflation and when they would begin to raise interest rates. On inflation, the number of members on the committee thinking inflation had risks to the upside jumped from 5 to 13…

Why Biden’s policies are in danger

The inflation story keeps getting legs as more and more companies are citing inflation concerns in their investor calls and interviews. As a matter of fact, The word “inflation” is being mentioned in post-earnings conference calls by the most companies in at least 11 years, enough to set a fresh record, according to research provided by FactSet.

As an example, the CFO of retail giant Costco Richard Galanti said this on the company’s latest earnings call:

“Chips shortages are impacting many items from an inflation standpoint, some items more than others. And with regard…

Today, the US BLS releases its monthly employment data. The expectations were for 950k NFP with some predicting as high as 1.4m new jobs created. The unemployment rate was expected to fall from 6.0% in March to 5.8% in April. Prior to the release, the US 10yr yield was 1.57% and the S&P futures were +9.

BLS said the NFP was 266k and UE was 6.1%. These are massive misses. Stocks bounced around from negative to positive, but bond yields dropped 8bps immediately. But it gets worse, March NFP was revised down from 916K to 770k. The table below shows…

Why Democrats will move on it

Key Takeaway: It is a logical political path, prepare for it now

Where we’ve been

After the passage of the $1.9 trillion stimulus bill, the Biden administration is moving on to the other items on their legislative agenda. As we’ve been writing and speaking over the last 18 months, this is an ambitious list of spending and tax programs to drive Democrats’ agenda. The list includes the environment ($1.7T), infrastructure ($1.3T), healthcare ($650B) and affordable housing ($640B).

While Democrats have a unified government with the House, the Senate and the presidency, they have a…

A Hint of Better Times Ahead

What’s astonishing about this data is how strong job creation was during a February cold snap that forced people to stay inside and a devastating storm which plunged Texas into the dark.

379,000 more workers found work in February, quite a surprise from the 225,000 expected.

Hint: it’s rising interest rates

Let’s get to the elephant in the room for most investors: volatility.

To begin, let’s talk about where we’ve been.