The average American family has received $11,400 of government cheques since the pandemic began. That’s a big windfall for people and a difficult economic puzzle for the US Federal Reserve to decipher.
More stimulus spending now, with the largest tax hike in decades to follow
When bond markets move, governments and stock markets take note. A swift rise in yields has rattled equities and focused attention on countries’ swollen debt piles.
Flowers, hopes and yields are rising as spring approaches. Still, the UK government is only very cautiously reopening as vaccinations continue apace.
It’s hard for seasoned investors not to give in to nostalgia for the days when government bonds could be counted on for both inflation-beating income and portfolio protection in times of market stress.
Company profits are bouncing back earlier than expected. How quickly will our economies come back to life once vaccinations are finished? And how different will they be?
When the going gets weird, the weird turn pro. The GameStop upheaval on Wall Street is part of the ongoing democratisation of finance. Ignore its effects at your peril.