{"id":9393,"date":"2021-03-11T15:59:09","date_gmt":"2021-03-11T15:59:09","guid":{"rendered":"https:\/\/zackspcg.com\/blog\/?p=9393"},"modified":"2022-02-26T13:05:52","modified_gmt":"2022-02-26T13:05:52","slug":"2021-stimulus-package-and-its-impact","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/2021-stimulus-package-and-its-impact\/","title":{"rendered":"2021 Stimulus Package and its Impact"},"content":{"rendered":"\n<p><em>Brianna R. from Norman,\nOK asks: <\/em>Hello Mitch, I\u2019m curious to hear your thoughts on the new stimulus\nbill. What big spending provisions are in it, and what you think it will\nactually do for the economy and the stock market. Thank you.<\/p>\n\n\n\n<p><strong>Mitch\u2019s Response:<\/strong><\/p>\n\n\n\n<p>Thank you for your email, Brianna. As I write my response,\nthe stimulus bill has cleared the Senate and is now moving to the House of\nRepresentatives. All signs point to it becoming law any moment now. <\/p>\n\n\n\n<p>The size of the bill remained unchanged even as it was\ndebated in the House and the Senate \u2013 $1.9 trillion is the price tag, making it\nthe second largest stimulus package ever (Trump\u2019s $2 trillion package signed\nlast March was bigger). Let\u2019s start with the big spending provisions that are\nin the new bill, and then I can answer your questions about what I think it\nwill do for the economy and the stock market.<sup>1<\/sup><\/p>\n\n\n\n<p>_____________________________________________________________________________<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/go.steadyinvestor.com\/arrow-volatility-guide?source=website&amp;medium=blog&amp;term=mitchsmailbox_blog_2021_03_11&amp;content=volatility_guide\">Tips on How to Manage Market Volatility! <\/a><\/strong><\/p>\n\n\n\n<p>The\nmarket has been very volatile for the past few weeks. In times like these, it\u2019s\neasy for investors to fall into emotional decision-making. When the market\nfluctuates, questions may rise &#8211; <em>Could volatility actually be an\nopportunity? What\u2019s the next step? <\/em><em><\/em><\/p>\n\n\n\n<p>The\nreal challenge is not in finding a way to eliminate volatility\u2014it is developing\na mental approach to dealing with it. Our guide, \u201cHelping You Manage Market\nVolatility,\u201d will provide you with insights and tips to do just that. Get\nanswers to questions like:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Market downturns can and will occur, but what should you do?<\/li><li>How can diversification help you manage volatility without compromising your returns?<\/li><li>When volatility is too much for you to handle, how can a money manager help?<\/li><li>Can volatility actually be an opportunity?<\/li><\/ul>\n\n\n\n<p>If you have $500,000 or more to invest and want to get answers to the questions above, click on the link below to download this guide today!<br> \u00a0<br><strong><a href=\"https:\/\/go.steadyinvestor.com\/arrow-volatility-guide?source=website&amp;medium=blog&amp;term=mitchsmailbox_blog_2021_03_11&amp;content=volatility_guide\">Download Zacks Volatility Guide, \u201cHelping You Manage Market Volatility.\u201d<\/a><sup><a href=\"https:\/\/go.steadyinvestor.com\/arrow-volatility-guide?source=website&amp;medium=blog&amp;term=mitchsmailbox_blog_2021_03_11&amp;content=volatility_guide\">2<\/a><\/sup><\/strong><\/p>\n\n\n\n<p>_____________________________________________________________________________<\/p>\n\n\n\n<p>First, there\u2019s the $1,400 stimulus checks. Centrist\nDemocrats in the Senate pushed to lower the income thresholds for who would\nreceive the checks, such that individuals with AGI of $75,000, heads of\nhousehold with AGI up to $112,500, and married couples with AGI up to $150,000\nwill get the full check. The payments phase-out quickly beyond those income levels,\nsuch that individuals with $80,000 in income, heads of households with $120K,\nand married couples with $160K will get nothing. <\/p>\n\n\n\n<p>The bill also has more support for small businesses, with\n$15 billion to the Emergency Injury Disaster Loan Program, which provides\nlong-term, low-interest loans via the Small Business Administration. This money\ntargets businesses with 10 employees or less. There is also $25 billion for\nbars and restaurants earmarked in the bill and another $7 billion for the PPP\nprogram. <\/p>\n\n\n\n<p>Unemployment benefits will also get a boost. The federal\ngovernment will kick in an extra $300\/week for unemployed workers laid off as a\nresult of the pandemic, a benefit that will now last through September.\nFinally, another big provision is the expansion of the child tax credit, which\nwill now be boosted to $3,600 per child under 6 and $3,000 per child under 18,\nboth of which are up from $2,000. As was widely reported, the minimum wage\nprovision is not included in this stimulus bill. <\/p>\n\n\n\n<p>In terms of what I think it will do for the economy and\nmarkets, I think the economic benefit is generally proportional to the size of\nthe bill. Much of the money in this bill is being directly transferred from the\nUS Treasury and the Fed directly to American households and businesses, and so\nI expect it to only add to the robust recovery already arguably underway. I\nhave written before about the inflation concern down the road, but I do not\nthink that\u2019s a 2021 concern. <\/p>\n\n\n\n<p>The stock market rarely shrugs off big stimulus packages and\nmore spending, but I would also say that much of this $1.9 trillion is likely\nalready baked into stock prices. It has been known for long enough that this\nstimulus bill was coming down the pipeline and was likely to pass, and I think\nthe stock market has already priced-in its potential effect. Even still, the\noutlook for economic and earnings growth remains pretty solid looking out over\nthe next six to twelve months, in my view, and the stock market should respond\nin kind. <\/p>\n\n\n\n<p>Even with\nthis positive outlook, there is no doubt that investors are facing\nunpredictable and challenging times. But there are steps you can take to navigate\nthrough market volatility. To help give insight into some ways you can do this,\ncheck out our guide, \u201cHelping You Manage Market Volatility.\u201d<sup>3<\/sup>&nbsp;It\nwill provide you with insights and tips to do just that. Get answers to\nquestions like:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Market downturns can and will occur, but what should you do?<\/li><li>How can diversification help you manage volatility without compromising your returns?<\/li><li>When volatility is too much for you to handle, how can a money manager help?<\/li><li>Can volatility actually be an opportunity?<\/li><\/ul>\n\n\n\n<p>If you\nhave $500,000 or more to invest and want to get answers to the questions above,\nclick on the link below to download this guide today!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Mitch looks at the scope of the just-passed stimulus bill and its likely effect on the economy and stock market<\/p>\n","protected":false},"author":3,"featured_media":7436,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[66,71],"tags":[],"class_list":["post-9393","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mitchs-mailbox","category-private-client-group"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/9393","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=9393"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/9393\/revisions"}],"predecessor-version":[{"id":10436,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/9393\/revisions\/10436"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=9393"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=9393"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=9393"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}