Bill’s By The Number$

Posted by: Lisa Navarro | Posted on: November 9th, 2020 | 0 Comments

NEXT POTUS – Joe Biden, the presumptive winner of last week’s election, is to take office on 1/20/21 as our nation’s # 46 president. Biden’s economic plan for the next 10 years (2021-2030) that was released during the campaign calls for $7.3 trillion of spending that would be paid for with $4.1 trillion of new taxes and $3.2 trillion of new government debt (source: Moody’s Analytics).

LOTS OF PROMISES – Joe Biden’s proposed $7.3 trillion of new spending over the next decade (2021-2030) includes $2.4 trillion on infrastructure, $1.9 trillion on education, and $1.5 trillion on both social welfare programs and healthcare (source: Moody’s Analytics).

WE VOTED! – An estimated 159.8 million Americans voted in the 2020 presidential race, representing 66.8% of the 239.2 million “voting-eligible” Americans. The 159.8 million voters are an all-time US record and the 66.8% is the highest “percentage turnout” in 120 years (source: NBC News).

LAST FOUR YEARS – From 11/08/16 to 11/03/20, i.e., the 4-years from the 2016 presidential election to the 2020 presidential election, the S&P 500 was up +70.3% (total return) or +14.2% per year. The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index with each stock’s weight in the index proportionate to its market value (source: BTN Research).

A MUCH SLOWER SPEED – The “velocity of money” in the United States was 1.104 in the 2nd quarter 2020, the lowest ever recorded in our country. The highest “velocity of money” level in US history was 2.198 in the 3rd quarter 1997. “Velocity of money” measures the rate that money is exchanged in our economy for goods and services. The rate has largely fallen for the last 14 years as more Americans have paid off debt or accumulated cash instead of spending money (source: Federal Reserve Bank of St. Louis).

DOWN, BUT GETTING BETTER – From a February 2020 peak of 158.8 million jobs nationwide, the United States is down 9.0 million jobs to 149.8 million workers as of the end of October 2020 (source: Department of Labor).

NO TO DOCTORS – Total health care spending in the USA in 2020 is forecasted to be 3.3% to as much as 8.8% less than what had been projected for 2020 before the pandemic began (source: Willis Towers Watson).

JUST NOT SOLVING THIS PROBLEM – As of 9am ET on Friday 11/06/20, 6,735 Americans had died from the COVID-19 virus over the previous 7-day period. That’s the largest number of weekly deaths as of Friday morning each week since 7,093 deaths occurred in the 7-day period ending at 9am ET on Friday 8/21/20 or about 2 ½ months earlier (source: NBC News, Meet the Press: First Read).

WHO SHOULD WE TRUST? – There are 214 vaccines for the COVID-19 virus that are in the development stage as of Friday 11/06/20, none of which have been approved by the FDA. 5 US states – New York, Washington, Oregon, Nevada and California – have announced plans to assemble their own scientific review panels to analyze any future decisions made by the FDA (source: Time Magazine).

WE WERE IN A WAR THEN – The US budget deficit for fiscal year 2020, i.e., the 12 months ending 9/30/20, was $3.1 trillion or 15.2% of the size of the US economy. That’s the largest “debt-to-GDP” ratio since the measurement reached 21.0% in 1945 or 75 years ago (source: Office of Management and Budget).

BETTER THAN EUROPE – The International Monetary Fund forecasted on 10/13/20 that the 39 “advanced economies” in the world (out of 195 countries worldwide) would contract by 5.8% during 2020. The United States is projected to contract by 4.3% while the 19 economies in the Eurozone will shrink by 8.3% (source: IMF).

TAXES – To take deductions on Form 1040, a taxpayer can use the “standard deduction” or the taxpayer can “itemize deductions” if the latter is greater than the former. The “standard deduction” will be $25,100 for married couples filing jointly and $12,550 for individuals in 2021. Please consult a tax expert for details (source: IRS).

THEY ARE NOT CAPITALISTS – The Chinese government has owned between 25% to 28% of the entire Chinese economy over each of the last 20 years (source: Gavekal Research).

STILL ABLAZE – The Cameron Peak Fire in Colorado began on 8/13/20 and was still burning as of last Friday 11/06/20 or 85 days later. It is 92% contained and has burned 209,000 acres (source: InciWeb).

WHAT IF THEY WERE GOOD? – Steve Cohen’s purchase of the New York Mets for $2.475 billion was approved by MLB on 10/30/20. That’s the most money paid for a US sports franchise in history, exceeding the $2.2 billion paid by David Tepper for the Carolina Panthers in 2018 (source: MLB).