AGF Management : A National Embarrassment as Congress Stalls on Virus Relief Bill

Insights and Market Perspectives

Author: 8

December 11, 2020

THE FACTS ARE OBVIOUS: Unemployment claims are surging, there are long lines for food, evictions are imminent, a wide range of relief provisions will expire at the
end of this month, small businesses are failing, a recession looms in the first quarter, and Covid fatalities are soaring - headed to nearly 4,000 per day by Christmas.

YET CONGRESS CAN'T GET ITS ACT TOGETHER as a virus relief bill - any bill - has bogged down, with no prospect of an agreement for several more days. It's a national embarrassment.

NOT ONLY HAS A VIRUS relief package stalled, the vehicle for such a measure - the $1.4 trillion 2021 budget bill - also may stall because just one senator, Rand Paul, may tie Congress into knots next week with a filibuster. Still another extension, past the Dec. 18 deadline, may be necessary.

THERE ARE DOZENS OF MODERATES who are anxious to pass a bipartisan bill, and there are persuasive arguments on both sides. No need to re-hash differences on liability relief or aid to state and local governments (which soon will have to lay off thousands of workers). And there's a case to be made for stimulus checks as opposed to unemployment benefits.

THERE'S NO NEED TO RE-VISIT the arguments about Mitch McConnell and Nancy Pelosi, both unwilling to bend; they're both villains in this narrative. Treasury Secretary Steve Mnuchin has been a relatively honest broker, but his boss is far more concerned about a ridiculous election plea to the Supreme Court which is certain to fail.

THE DEBATE ON A RELIEF BILL will drag on, surely through late next week and perhaps past Christmas. Fatalities will soar and food lines will lengthen, as Congress dithers - seemingly oblivious to the suffering.

VACCINES ARE COMING: Perhaps by April or May the country will have some degree of herd immunity; the stock market has priced in a booming economy by summer. But we have to get from here to there, and this will be a very difficult winter if there's no relief bill. We still expect a deal by Christmas, but prospects have slipped - it's a national embarrassment.

The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies.

The views expressed in this blog are provided as a general source of information based on information available as of the date of publication and should not be considered as personal investment advice or an offer or solicitation to buy and/or sell securities. Speculation or stated believes about future events, such as market or economic conditions, company or security performance, or other projections represent the beliefs of the author and do not necessarily represent the view of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies. Every effort has been made to ensure accuracy in these commentaries at the time of publication; however, accuracy cannot be guaranteed. Market conditions may change and AGF accepts no responsibility for individual investment decisions arising from the use of or reliance on the information contained herein. Any financial projections are based on the opinions of the author and should not be considered as a forecast. The forward looking statements and opinions may be affected by changing economic circumstances and are subject to a number of uncertainties that may cause actual results to differ materially from those contemplated in the forward looking statements. The information contained in this commentary is designed to provide you with general information related to the political and economic environment in the United States. It is not intended to be comprehensive investment advice applicable to the circumstances of the individual.

AGF Investments is a group of wholly owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments America Inc. (AGFA), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFA and AGFUS are registered advisors in the U.S. AGFI is a registered as a portfolio manager across Canadian securities commissions. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The subsidiaries that form AGF Investments manage a variety of mandates comprised of equity, fixed income and balanced assets.

Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. AGF brings a disciplined approach to delivering excellence in investment management through its fundamental, quantitative, alternative and high-net-worth businesses focused on providing an exceptional client experience. AGF's suite of investment solutions extends globally to a wide range of clients, from financial advisors and individual investors to institutional investors including pension plans, corporate plans, sovereign wealth funds and endowments and foundations.

For further information, please visit AGF.com.

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