By Daniel McGarvey

Last month, Stonebridge Financial Group was thrilled to host noted economist Anirban Basu for the second time. Anirban presented a webinar timed to the first 100 days of the Biden presidency. Here are five key takeaways from his presentation:

1. Recovery takes time

The U.S. has demonstrated that it is capable of massive V-shaped economic recovery over very short periods of time. Yet we are still down around 8.4 million jobs since the pandemic began, with the leisure and hospitality sector hit the hardest at 3.1 million jobs lost.

2. Employment growth has varied from state to state.

Every major metropolitan area in the U.S. has suffered from negative employment growth over the last year. Cities in states with governors who fought to keep their economies open suffered less. The Harrisburg area has fared better than the country as a whole at 4.2% employment loss.

3. Retail sales were quite strong in 2020.

This is mainly because of internet retailers and at-home workout equipment. Many large brick-and-mortar retailers went bankrupt, such as Guitar Center, J.C. Penney, GNC and Pier 1 Imports. Restaurants and bars suffered the most, but restaurant reservations are nearing their pre-pandemic levels.

4. The housing boom is real.

Unlike in prior economic crises, home prices have sharpened steeply over the last year because of low interest rates and a rise in working from home. Remote work has decreased the value of proximity to economic centers, leading to a migration from city apartments to suburban homes.

5. Things look good now, but they may get bumpy down the road.

Although economic demand has been boosted by stimulus, supply may have trouble keeping up because of ongoing lockdown measures. This should bode well for rapid economic growth through the rest of 2021, but eventually, there will be a day of reckoning when we have to pay for the government deficits we have incurred. Economic momentum has been stoked by continued stimulus, which has led to U.S. federal debt exceeding $28 trillion, and at some point, that will have to be accounted for.

These are only a few highlights of the webinar. Click here to listen to Anirban’s full presentation.

Daniel McGarvey - Junior Analyst

Daniel is a Junior Analyst at Stonebridge Financial Group and works on portfolio analysis and other related tasks. When away from the office, Daniel spends his time playing guitar, reading, and exploring the outdoors.