@Threemom wrote:
True. But it's yet another economic strain that will have to be paid for somehow. It has been a year of unusually bad and expensive circumstances.
2stepps is maybe right that this should possibly go in another thread (hmmm, maybe my stimulus talk one), so I'll keep it short and maybe take up the topic in that thread.
My view (if you've read my old posts) has long been that the economy and virus threat are deeply intertwined. The faster/better we control the virus, the faster the economy can revive. Yes, another lockdown would require tremendous Federal Reserve support for that 30-45 day purge. That's a lot of money printing.
BUT, no proper lockdown and just letting the virus be a constant threat is also very expensive (unless one believes Congress will not pass a continued/extended stimulus bill - I think we get mass riots with possible huge spikes in crime in that scenario and absolute chaos in America), as we'll just have to keep passing these extended bailout bills ever 4-6 months for the next year or two.
The economic math proves this. Spending by the wealthiest 25% of Americans, who account for 2/3rd of consumer spending in America, is down 10% from the pandemic. Yet, their jobs and stock portfolio situation are back to pre-COVID levels. So, it's not for lack of money. They care about the virus threat. What's keeping the economy on life support has been the bailout money that's spurring spending by the lower-tiered income groups. These people need the money, have lost the most jobs, and spend close to all they get usually (out of necessity) on things they need.
To maintain lower-income spending, Congress HAS to extend stimulus. That will mean massive money printing. But, as long as the virus threat is still out there, this is just a temporary solution. They'll have to keep extending that stimulus and printing more and more. So, it becomes which is better?:
a.) re-lockdown aggressively and do it right
b.) constantly have these bailouts and intermittent partial, local lockdowns
Either way, America will be printing a ton of money. I just think we get through this faster if we take the pain up front.