Based on income and family makeup, about 90% of Americans may expect to receive $1,200 individually ($2,400 for joint filers) and $500 per dependent.
Lawmakers in Washington struck a compromise on a major fiscal stimulus package to help combat the effects of the COVID-19 pandemic. The bill, already passed by the Senate and awaiting House vote, packs in a lot, with upward of $2 trillion slated to provide important support for the economy, explains Chief Economist Scott Brown. In comparison, the American Recovery and Reinvestment Act of 2009 was $831 billion.
Chief Investment Officer Larry Adam concurs, saying, “While the economy is likely to temporarily struggle, the combination of monetary and fiscal stimulus efforts will mitigate the worst-case scenarios and help serve as a bridge to when normal economic activities can resume.” This optimism has helped the S&P 500 post its largest three-day rally (+17.6%) since April 1933. Prospects for positive volatility is the main reason Adam has continued to encourage investors to “stay calm and not panic” during these emotionally driven swings in the market, especially as policymakers aggressively respond to this health crisis.
Despite tense – and at times frustrating – negotiations, lawmakers put together this bipartisan package much more quickly than initially anticipated, considering the magnitude of the response. Key provisions to expand unemployment eligibility and benefits cannot come soon enough as Thursday’s unemployment report from the Department of Labor set a record high for initial jobless claims – rising by more than 3 million for the week of March 21, reflecting job losses in hospitality, entertainment, recreation, transportation and warehousing, as well as manufacturing.
And they may still do more, depending on how long the pandemic lasts. Lawmakers are already talking about another round of intervention in their phased approach. While it may take some time to see results of this broad-ranging stimulus, here’s a look at what you can expect in the near term, according to Washington Policy Analyst Ed Mills.