Updated: Dec 21, 2020
We continue to see a downward trend regarding COVID-19 in the United States; however, a recent increase in cases, mainly from a rise in testing, has occurred over the last week. It is possible that the lower outside temperatures caused a spike in cases, but the U.S. has still experienced more cases thus far compared to other regions. There is evidence of indirect deaths because of the lockdowns, too; in other words, additional people are dying from the lockdown along with the virus.
As the election quickly approaches, there is significant risk of political turmoil from to mail-in-voting, as well as the recent death of Ruth Bader Ginsburg, which left the Supreme Court justice position vacant.
Gross Domestic Product and Unemployment
There was a pause in GDP growth as unemployment is not improving as quickly as was hoped. Due to unemployment still being over average, additional stimulus. Small businesses are continuing to close, and a few are up and coming. Retail, restaurants, and other service-related business keep getting hit hard, putting a drag on the number of people employed.
Money Supply & Dollar Cost Averaging
Money supply continues to decline, and I am beginning to see weaknesses in money supply growth at a pace greater than could have been previously foreseen. Therefore, we expect a softening in capital markets; however, there is enough growth to continue having an inflationary effect.
While money supply decreases, the dollar is bouncing off of a technical resistance, and gold and precious metals are selling based on news. We continue to monitor the positions, but markets do not move in a straight line.
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. All investing involves risk including the possible loss of principal. No strategy assures success or protects against loss. Dollar cost averaging involves continuous investment in securities regardless of fluctuation in price levels of such securities. An investor should consider their ability to continue purchasing through fluctuating price levels. Such a plan does not assure a profit and does not protect against loss in declining markets.