Our monthly Economic Newsletter provides insightful information to help our clients make more informed financial decisions.
Spring has sprung, and the season of hope is resonating throughout the economy. After suffering a 3.5 percent contraction in 2020 – the steepest since demobilization in 1946 – real GDP is poised to surge as much as 7 percent this year, which would rival the biggest annual gains since World War II.
The bleak economic landscape that prevailed in the closing months of 2020 has not faded from the collective memory of the American public. With the pandemic still claiming too many lives and the economy still reeling from business restrictions and virus fears that hamper normal behavior, the lingering effects cannot be ignored.
It’s shaping up to be a cold winter for the U.S. economy, as the pandemic continues to rampage throughout the nation and wreak havoc on all forms of activity that involves in-person transactions. State and local governments are tightening business restrictions and urging residents to more diligently adhere to social distancing protocols.
We’ve always said that the health crisis would determine the path of the economy, and the latest news on the pandemic is concerning. Cases of the virus, hospitalization and mortality rates have surged to unfathomable levels, and health experts believe this distressing trend will accelerate after the holidays.
Like his former boss, President Barack Obama, Joe Biden will be inheriting a damaged economy when he takes office on January 20, 2021. The Covid-19 pandemic has not only sent the nation into its deepest recession since the 1930s, it is leaving indelible scars that will restrain activity for some time to come.
The coronavirus recession has hit the U.S. with tremendous force. Following the sizeable 4.8 percent contraction in GDP during the first quarter – putting an end to the longest expansion on record—activity is poised to plunge by a depression-like 30-40 percent annual rate in the second quarter.