Monday Musings: February 22, 2021

Feb 22, 2021

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Public Trust Credit Team
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Biden’s stimulus proposal fast-tracked by Democrats, initial House vote planned for Friday

This week, the Biden Administration is preparing its final push for a $1.9 trillion stimulus package with the House planning to vote on the proposed bill by Friday, setting the stage for a Senate vote as early as next week. Based on this timeline, the Senate appears to be on track to ratify the large stimulus bill before the expiration of unemployment insurance benefits on March 14. Key provisions of the spending plan include $422 billion for stimulus checks to individuals, $350 billion for state and local governments, $246 billion for supplemental unemployment insurance, $160 billion to combat COVID-19 including vaccines, testing, and tracing, $130 billion aimed at reopening K-12 schools, and an additional $7.25 billion for small businesses via the Paycheck Protection Program. With the expiration date of unemployment insurance quickly approaching, Democrats have expressed there is no longer time to negotiate with Republicans on the provisions of the plan and are using a fast-track budget procedure to enact the bill without the need for ten Republican votes. This procedure requires that the total cost of the plan not exceed $1.9 trillion and that all provisions be fiscal in nature, suggesting that the $15 minimum wage proposal is unlikely to make it into the final Senate version of the bill. Should the Senate vote to approve any final changes to the spending plan, the House will vote on the bill again prior to the March 14 deadline.  
All comments and discussion presented are purely based on opinion and assumptions, not fact. These assumptions may or may not be correct based on foreseen and unforeseen events. The information presented should not be used in making any investment decisions. This material is not a recommendation to buy, sell, implement, or change any securities or investment strategy, function, or process. Any financial and/or investment decision should be made only after considerable research, consideration, and involvement with an experienced professional engaged for the specific purpose. Past performance is not an indication of future performance. Any financial and/or investment decision may incur losses.

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