Congress has not yet arrived at another stimulus deal after months of discussions, while the probability that anything will be ratified before the election on Nov. 3 is, in effect, zero as Senate Majority Leader Mitch McConnell indicated that the legislative body will be out of session up to Nov. 9, CNBC reported.
U.S. House Democrats were indicating earlier this month that headway was being made on talks regarding a new stimulus package, but there wasn’t much sign that anything would be ratified in the two weeks prior to the election, the Financial Times (FT) noted Oct. 20.
As the economy exhibits new signs of decelerating, and employment gains are encountering some recent headwinds, PYMNTS research highlights the ways in which support could be of immediate use.
PYMNTS has noted that there have been some bright spots among the firms it has polled in recent months that are representative of the small- to medium-sized businesses (SMBs) that fuel approximately two-thirds of the American economy.
Fortunes have improved slightly — mindsets at a minimum. In a poll of over 1,100 respondents, 38 percent indicated that their financial stability had remained unchanged, and 17 percent noted things have gotten better.
While the picture in totality may be decent, the outlook is decidedly mixed. Amid the firms that categorized themselves most at risk of closing during the pandemic, most segments felt a bit more optimistic.
Professional services remained pretty much the same, however, and that could be an ominous sign, as so much of the economy is service-oriented.
Federal Reserve Chairman Jerome H. Powell in early October said in remarks that financial support should be on the radar.
“Too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses,” Powell said.
Powell noted, however, that “by contrast, the risks of overdoing it seem, for now, to be smaller.”
Federal Reserve Governor Lael Brainard later in October cautioned that further stimulus spending would be required to change a “K-shaped recovery” in the U.S. into one that is “broad-based and inclusive.”
She informed Society of Professional Economists members on Wednesday (Oct. 21) that the largest threat to the recovery of the American economy would be the failure of further fiscal support to come to fruition.
The news comes as the country is facing a third tide of new COVID-19 infections, while approximately 23 million are receiving joblessness benefits, CNBC reported.
In terms of the stimulus, Republicans and Democrats in Congress had the most dissent when it came to bolstered joblessness insurance to individuals who have become unemployed. While House Speaker Nancy Pelosi had been bargaining for a relief package valued from $1.8 trillion to $2.2 trillion, McConnell had sought a “skinny” bill valued at approximately half a trillion, according to CNBC.