1) President Biden is asking Congress for $1,400 stimulus checks, but economists advise caution before spending, because economists who have looked at what happens when people have time to mull over a financial windfall, found that they spend less of the money, rather they save more of it. With less spending, there is less stimulus to the economy, therefor the stimulus fails to do the intended purpose. For the first stimulus checks in April people generally spent between one-quarter and one-third of the check in the first 10 days. Bottom line, the longer payment delays make it more likely that households will save their stimulus checks, which undermines the goal of stimulating the economy by boosting consumption.
2) The Treasury Secretary nominee Janet Yellen will be part of the Senate Finance Committee process of vetting President Joe Biden’s $1.9 trillion dollar Covid-19 relief plan. She will say that low borrowing costs means it’s time to act big. The new package includes a minimum-wage hike and substantial expansion in family and medical leave, social safety-network of programs that have already triggered Republican opposition. There are still almost 11 million unemployed Americans in an economy still being battered by the pandemic. Declines in both payrolls and retail sales in December left the nation’s economy limping into the new year. Additionally, more than 17 million people say they have little to no confidence in their ability to pay their rent next month. However, Yellen will also be asked what the safe debt limit is, since it is already on the verge of surpassing 100% of the GDP. There is also the question of the pros and cons of strengthening the dollar among fears that a stronger dollar will weaken the U.S. economy.
3) The U.S. government has approved routes for a system of pipelines that will move carbon dioxide across Wyoming for disposal. The greenhouse gas is captured from coal-fired power plants, to keep it out of the atmosphere where it causes global warming. The captured CO2 is then pumped underground to add pressure to and boost production of oil fields. The pipeline is about 1,100 miles of federal land through the Wyoming Pipeline Corridor Initiative. This project is a way to boost the state’s struggling coal mining industry.
4) Stock market closings for – 21 JAN 21:
Dow 31,176.01 down by 12.37
Nasdaq 13,530.92 up by 73.67
S&P 500 3,853.07 up by 1.22
10 Year Yield: up at 1.11%
Oil: up at $53.03