The economy is booming and everyone should enjoy it. The American economy is benefitting from tremendous amounts of pent-up demand and in some of the hardest-hit industries’ activity is beginning to tick back up above 2019 levels. Along with that boom, there are clear signs of inflation and concerns about overheating. Even Janet Yellen seemed concerned for a few hours last week.
The US economy is surging and life is returning to normal. Consumers have healthy balance sheets and inflation is a hot topic. Companies in hard-hit industries are even talking about having a difficult time finding staff. The Fed seems to be seeing a different picture of the economy though and has no intention of tapering pandemic era stimulus until it’s clear that the economy has returned to maximum employment and inflation is running above 2%.
The economy is booming and companies are expecting robust growth in the second half of 2021 and 2022. Travel is starting to rebound and cities are coming back to life. Stimulus has left consumers with a tremendous amount of liquidity and we are spending. Institutional investors are increasingly concerned about inflationary pressures.
Tens of millions of Americans have now been fully vaccinated and the fun is just beginning. Re-opening euphoria and pent-up demand could lead to an economic boom that lasts into 2023. Supply chains, especially semiconductors, are still feeling the effects of Covid, and price pressures continue.
Confidence is high in the US thanks to strong vaccination rates. What will the new normal look like though? Offices could re-open by summer, but how much will we continue to work from home? And how much will we travel for business? Supply chains are still bottlenecked, leading to inflation pressure. The blockage of the Suez Canal won’t help that
It’s hard to remember that there’s still a pandemic going on. Vaccination rates have increased and it looks like we may be on the cusp of a roaring 20s. Consumers are healthy and eager to make up for lost time–booking travel and eating out. Offices will probably re-open by the end of summer but working from home is likely to remain an option.
As vaccines continue to be administered the end of the pandemic appears to be at hand. People are resuming normal lives and pent up demand is being unleashed. Consumers are looking forward to a summer filled with travel and congregation with family and friends. Even the Fed is noticing the brighter outlook. The world is opening back up but it probably won’t ever be the same as it was before the Pandemic.
Vaccines continue to be administered and supply will likely open up, even more, starting in April. Consumers have been dreaming of a return to normal and we appear to be at the cusp. The result of vaccination could be an explosion of pent-up demand for hardest-hit industries and a much better second half than people expect. Still, strong demand is putting pressure on supply chains and creating inflationary pressures. Given that stimulus is dependent on a K-shaped recovery, normalization could bring its own economic disruptions.