Last Thursday, BLS reported that over 6 million applied for unemployment in the previous week. That brings total unemployment claims in the last two weeks to over 9 million. By late April, BLS could be reporting unemployment of well over 10%. Some economists are projecting annualized Q2 GDP declines of 20% or 30% or more.
In response, Congress and the President have enacted three stimulus packages which, with help from the Fed, will result in over $2 trillion in new spending. The federal bureaucracy will be put to the unprecedented test of distributing instant relief to millions of businesses and tens of millions of people.
Here are the questions that investors are asking:
- What will be the macro impact of these packages?
- What are the odds that additional stimulus may be enacted (a step Speaker Nancy Pelosi now advocates), especially if the current package appears defective or insufficient? And what provisions would be included in a Stimulus 4 or 5?
- Which businesses and sectors benefit and which get hurt (relatively speaking) from the stimulus packages?
- What unintended collateral damage may result from the stimulus packages--e.g., to banks, credit markets, labor supply?
- Will institutional delay and leakage undermine the stimulus impact--due to pushing all this spending/lending through banks, the SBA, the Fed, and the states?
- What about the impact of this historic governmental activism, at a time of crisis, on the political outlook for the 2020 election?
Listen, as Hedgeye's Neil Howe and I answer all these questions and more. There's a lot of ground here, and we cover it all.
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