The combination of a stimulus stalemate, Tyrannical responses to a renewed COVID case wave (note the death rate remains flat), and the fading hopes for a 'blue wave' are all triple-whammying market optimism.
A "bear" case which results in an exponential surge in new cases would almost certainly lead to another economic shutdown, especially under a Biden presidency.
... despite low debt-to-income ratios, the percentage of government transfer payments (social benefits) now comprises 1/4th of real disposable incomes.
"An orderly Trump victory as the most favorable outcome for equities (upside to ~3,900).... A ‘Blue Sweep’ scenario is expected to be mostly neutral in the short term..."
While these restrictions are not yet as tight as in spring, the latest set of data has already revealed that the pace of economic recovery in services has started to lose momentum...
It's another very busy week, including the peak of earnings season as 184 S&P 500 companies report; we also get several central bank announcements and what will likely be a record GDP print in the US.
The belief that central banks printing currency can "buy/fix" everything that's broken, lost or scarce is the ultimate in denial, fantasy and magical thinking.
