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.

But I’m Still An Apocaloptimist

My apologies: There is no returning to a pre-pandemic economic “normal”

We have seen the best our technology can produce when Moderna and Pfizer announced their vaccines at the end of December. The speed and efficacy are breathtaking and miraculous. As of this week, the US has given out over 57 million doses and globally it’s 186 million. At this rate, the Biden administration is easily meeting their goal of 100 million doses in 100 days as the nation is immunizing 1.69 million per day according to Bloomberg’s Covid-19 Vaccine Tracker. …

Why Elon Musk is Like a Greek God

Let’s state this right at the start: the goal of the Biden administration, Congress and the Fed is to make the economy white hot.

Not trend growth, not strong growth, but 8–10% GDP growth.

Let that sink in for a minute.

The US economy will recoup the lost economic growth from 2020 in 2021. Remember in June of last year, the Congressional Budget Office estimated it would take 10 years to recoup this lost economic output or output gap. They are everything we’ve come to expect from a government economic research group.

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Top 5 Driving the Economy and Markets Right Now

#1 AOC, Redditt and GameStop. It’s hard not to smile when I see what’s going on with GameStop and Redditt as the once less-powerful retail investor took on bigger hedge funds and won. Turns out, they do know about options and what happens when the underlying price approaches the strike price. It makes the shorts have to buy to delta hedge, driving the price up and creating a short squeeze for the ages and crushed a few hedge funds along the way. It reminds me of the axiom I followed when…

The #CapitolRiots of last week will transcend our time and will likely be referred to as the “Electoral Rebellion of 2021.” Think Whiskey Rebellion, where President Washington had to send troops into a state to quell a revolt.

1. Vaccine Hesitancy

2. Virus Mutation

3. Cyber War

4. Protracted Congressional Fighting

5. Credit Crunch

The combination of 1 & 2 will be tragic. But if accompanied by 3,4 or 5, then the optimism for the economy and the enthusiasm for stocks by investors will both shift down significantly.