Never Bet Against America
2020 tested America like no other year. It was as if the perfect storm made landfall and washed across the continent. The Covid pandemic, the shutdown of the economy, a presidential election, fires and hurricanes, and civil disobedience.
Yet, as the economy was near the bottom, investment legend Warren Buffett reiterated, “Never bet against America.” We won’t forget this year, but optimism is embedded in our DNA.
Last week, Congress passed a $900 billion Covid-relief and a $1.4 trillion government-funding package that provides pandemic aid and funds federal agencies through September 2021.
It’s a bill that runs over 5,000 pages.
One only needs to walk into a restaurant to see the distortions generated by the Covid pandemic. That assumes the restaurant is open.
Sales at restaurants are down 17% vs one year ago, according to U.S. Census data. But sales at grocery stores are up 11%.
Daily Covid cases have jumped and many state officials have introduced new restrictions, which is beginning to have an impact on the economy.
In November, retail sales fell 1.1%. Ex-autos, sales were down 0.9%. As Figure 1 illustrates, sales came roaring back earlier in the year thanks to generous jobless benefits, $1,200 stimulus checks, job growth, and the re-opening of businesses.