Biden’s US$1.9 trillion fiscal stimulus package looks set to be passed into law
Prospect of fresh U.S. fiscal stimulus has already buoyed risk markets and sent Asian markets higher
Two checks mean a little to me, but it means a big deal to you.
I saw a man with no clothes, just money, and fame.
until I really got free money with just to rock it.
the answers are sitting with the Reddit flock.
(Rapped to the tune of “Mr. Wendall” by Arrested Development, off the album “3 Years, 5 Months and 2 Days in the Life Of…”)
On the brink of securing final approval from Congress, the Biden administration is set to pass a staggering US$1.9 trillion stimulus bill, betting that massive fiscal intervention aimed at lower and middle class American families will juice America’s recovery without overheating the economy.
Over the weekend, the U.S. Senate voted on party lines to approve Biden’s fiscal stimulus package on the narrowest of margins, and given that most markets were closed, the only speculative asset that could head northwards was Bitcoin.
Barring any surprises in the House of Representatives, where the Democrats hold a slim majority, Biden’s stimulus package looks set to be passed into law.
Representing one of the biggest U.S. government interventions in the economy after the Second World War, Biden’s fiscal stimulus is just shy of the record US$2.2 trillion pandemic stimulus passed in March last year under the Trump administration, and makes the US$787 billion recovery plan during the 2008 financial crisis look like a rounding error. Around the world, the U.S. fiscal stimulus package should give a fresh jolt to the global recovery amid optimism that increasing vaccinations throughout the year will help to reopen many economies.
But the recent spike in U.S. Treasury yields (how much it costs the U.S. government to borrow) and the tepid response at the most recent U.S. bond auctions, suggests that risks remain that an unintended jump in inflation could unsettle markets and prove particularly damaging for emerging markets, many of which have their debt denominated in dollars.
Regardless, many of the US$1,400 stimulus checks that the Biden administration is dispatching to means-tested Americans might trickle into the markets.
The pandemic has already led lower and middle income Americans to tighten their belts, and given the American penchant to take on risk, might see many Americans who were left out of the GameStop (+4.07%) and AMC Entertainment (+0.25%) trades, head back into the market to find fresh ones.