In this special episode, four leaders across Goldman Sachs—Alec Phillips of Goldman Sachs Research, Amelia Garnett of Global Markets, Susie Scher of the Investment Banking Division, and Ashish Shah of the Asset Management Division—discuss what the $1.9 trillion American Rescue Plan means for the economy, markets, corporations and investors.
Recorded March 17, 18, and 22, 2021.
This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
This is it
changes Goldman Sachs when we discuss developments, curly shaping markets, industries in the global economy, objects. You go ahead of corporate communication, shared the firm recently come
proved a sweeping one point: nine trillion dollar corona virus believe package called the american rescue plan.
the plan authorizes federal spending in the form of another round of stimulus payments for most Americans additional unemployment aid to those out of work and also
Some changes to the tax code to help families with children. This on top of two prior
in those packages today, we have a special episode, but will that deeper into the impact of this info?
sixteen those on the economy and its impact across mark.
to do that enjoyed by four different gas from different division, shared Goldman Sachs Alec, Philips of Goldman Sachs Research, Amelia Barnett by global markets, division, Susie, sure of our message, banking vision and a she shop of our asset management division, our first,
yesterday's Alec Philips, chief political economists from Goldman Sachs research. Alec is here
talk about the economic implications of the stimulus package that was just signed in the law out walking back to the problem, but a mere so
as I just mentioned, Congress recently passed the one point: nine trillion dollar american rescue plan at the last in a series of economic stimulus plans as this compared the stimulus, you'd been forecasting and where's the money going here. So I think, by the time we got to the final stages we knew it was going to be pretty close to what the president had initially laid out. I mean, I think it was actually I'm anyway. Surprisingly, close to what the president had laid out, the final package came in at one point: eight four trillion:
so just under eight and a half per cent of GDP,
a little less than the one point nine he called for, but he I'm pretty similar. We had built in one and a half trillion so just under seven percent of GDP into the forecast, but we kind of new. By the time we were getting close to the final vote that it was going to exceed that in terms of where the money,
scowling, probably the most
the thing is the payments to individuals so between that and the expanded child tax credit that's worth a bit over five hundred billion so that together the biggest piece of the bill. Three hundred and fifty billion in stating local aid, not a hundred and seventy Billy,
for schools. On top of that, you that's the other, really big piece and
The unemployment benefits is probably the other, pretty notable things that they ve extended three hundred dollars a week and extra benefits plus expanded eligibility through September
None of that is particularly surprising, but I'd say all of it was like a little bit bigger than what we would have expected more.
Tibet shouldn't have in terms of the difference.
between where we were in what ended up happening. It shouldn't have it.
huge impact on twenty twenty one, the payments to individuals and the trial tax credit will have a positive impact, dared what we ve been expecting, but a very modest one. Some of the big differences actually care
in things like state and local aid, where it's going to take states a long time,
then that money, and so a decent amount of this is going to take until twenty twenty two or in some cases, twenty three twenty four to spend out. So you know overall,
I'd say the general structure of that was pretty similar to expectations is just that the about on some of these things were a bit bigger than what we ve been expecting so
In light of those changes and slightly rotter bigger package, what changes are you making along thirteen to longer
fiscal assumptions? Well, I think, probably the most
one thing that came out of this package was the expansion of the child tax credit and just in terms of its implications for longer term fiscal policy.
Ground on bad is. It was two thousand dollars per child limited to certain incomes. That's moved up now to act.
number thirty, six hundred dollars per child again.
The desert men gums its heart.
To see Congress letting that expire at the end of the year and the novel development here is that the Treasury would be sending checks out or payments out on a periodic.
since may be its monthly basis. Maybe it's every couple of months and once they
Our doing at my guess is that there can be a lot of pressure.
to continue doing it, and so we are now assuming that gets extended. That probably is worth a little bit more.
And a hundred billion per year, and so that will add to fiscal support and twenty twenty two twenty twenty three and beyond and then
everything is. It does seem likely that at least some of these unemployment benefits will probably be extended beyond their current exploration in September. So we're assuming a bit more there to maintaining the big
question. Now is what happens on infrastructure and the next round of fiscal, and so we are making some assumptions. There were
assuming a little bit more than a hundred billion next year, and additional spending there but denied
there's a lot of uncertainty about what all that's gonna look like, and it s very much a place older. This point will it started
a bit more about that. Would details are available on the next potential fiscal package that seems to be focused on infrastructure, and the big talk is that they'll be some pay force and that which is a nice we having access? What do you expect
you're mad and for the rest of twenty twenty one as far as a legislative outlook. Well, I think it's hard to say
How President Biden will come in smaller than his campaign proposal, which was two trillion dollars
where you may see it turned out to be a little bit. Smaller is how much happens in the next few years. If you look back to the campaign Biden had proposed
two trillion dollars
usually in his first term so over four years norm,
Congress looks at these things on either a five or ten year basis, and so you know two trillion over ten years seems like a pretty realistic approach you how it could be bigger than that
I think the main risk to the upside in terms of size would be if it
beyond what we would think of his infrastructure to other things like, for instance, child care. Maybe some education related incentives. There is talk about no student blown debt relief, possibly
healthcare items and the reason I
that this is at least gonna come up in the
caution is because this is probably
the last big fiscal package. The Congress passes before the mid term elections as a technical matter always a chance. They could do another one, but politically they may run out of steam, and you have about fiscal and deficit standpoint. There may run out of appetite to do yet another large, what inside it
it would be a lot of pressure to get as much as they can in this next package, because whatever doesn't get included in this package is
probably gonna be century left until after the midterm election, where the others clearly a chance,
that Republicans are able to take. The majority in the house will see what happens there, but there is no certainty about that and so
the other is gonna, be pressured to make us bigger, not smaller. On the tax side, then
big question right Now- is how much of this package are they going to try to pay for
My sense is that a binding
Restoration is probably meaning I feel a bit toward the lower end of that, so paying, for you know just a fraction of it, whether it's a quarter or a third or who knows but somewhere in their, whereas I think the marginal vote in the House and Senate. So centrist Democrats are generally, I think, leaning toward larger shares being paid for
yeah? I think we know that there are some things that are gonna be in play. A corporate tax rates increase, probably gonna, be in play present binds proposed taking back to twenty eight percent of waste.
during the campaign. I don't think it's likely to get that high,
you can certainly imagine at getting two twenty four twenty five percent, something like that capital gains present proposed during the campaign to take that
the ordinary income tax rate again seems unlikely to get that high. But you can
Imagine a rising maybe to hide what age or something like that, and those two things together with
will they generate several
rebellion dollars along with
smaller changes may be. They could get to a trillion dollars. I'd be personally surprised that they could get much more than that through the
ex side, and there are some things
can do outside of taxes to maybe raise a little bit of money. Prescription drugs uprising was one possibility, but overall I
it can be difficult for them to raise more than one say, a trillion dollars efforts at years, and that will probably even
your challenge, and so, if you take just a hypothesis,
whole scenario where they want to offset half the cost of the bill
an essentially leaves you with the two trillion dollar bill, one trillion paid for all about in flux them
want to spend more than may want to pay for less we'll see what
happens, biting that sort of the broad contours and will probably find out more in a few weeks. It looks like crazy
bindings, going to address a joint session of Congress, or at least that's the talk next month
and I'd. Imagine that at that point you lays out only some more data around all about
so I had a Wally's fiscal policy dynamics are one point: nine trillion dollar package pastor two trillion dollar ten year package in the offing. How did they change your outlook for GDP growth in the United States and what you're projections are for unemployment? So I think, as far as the growth impacts, what just past
this probably going to have the biggest growth impact and
the infrastructure, peace is probably gonna, be smaller simply because, while the numbers might seem comparable, you know you're talking about around two trillion dollars for each the case that just now,
Ass is essentially almost two trillion dollars concentrated in twenty twenty one and, to a lesser extent, twenty twenty two, whereas infrastructure, if it happens, is
I'm a way around two trillion. Maybe it ends up being more than that, but spread out over several years. So
in terms of the economic impact based on what's past and everything else that's going on. We are,
assuming eight percent growth this year on a cure for the few for basis. It just means young averaging the growth over the four quarters and that's relative.
To a six percent incenses estimates
We are well above consensus on that for next year
also about consensus, but less so so. Two point: nine for us versus two point: six for consensus, so getting back to sort of a more normal growth rate, but still clearly above trend and
in terms of unemployment, we are expecting the unemployment rate to decline just a little bit faster than what we ve been expecting previously based on this package, so
or essentially expecting four percent at the end,
this year. Three and a half by the end of next year
pretty low levels and getting basically back to sort of pre covered trends for
there. You know. Obviously it's gonna depend a lot more on the progression of everything else. Advice on fiscal policy, namely the FED among us
things, but clearly this is a pretty big boost, so Alan
obviously some very very big stimulus packages between the Trump Administration Abide administration, and not very much of it. Paid for almost nine of pay for people have now
been very focused on financing all this deficit spending. Could that out
change. And could we see a little more fiscal restrained if interest rates begin to creep up it also
I mean we have seen interest rates creeping up- that's probably not so much because of what's happening at least directly in terms of issuing dad. It's you know, obviously more because of the growth outlook and two lesser
and maybe the monetary policy I love. It- turns out tat
raise ability to finance all our best, and yet I guess one thing I would say is that, while interest rates arising, the Treasury has a fairly long what they call average maturity, which means that, for every percentage point increase in the rate in the market, it's going to take several years for that to flow through
into the treasuries borrowing costs, because they borrow a lot. You know over the longer run, so I think the way people are,
this right. Now is really that these are one time expenses and that if we look at deficit projection several years out, we basically do get back down to the pre pandemic, run rate in terms of deficits. But you know with the larger debt stock and as
rates increase our time. If they do, then that means essentially the same interest rate multiplied by a large. That stock gives you
a somewhat larger interest. Experts right now,
all of that is well under control, but it does leave a little less flexibility over the longer run and if we do see interest rates creep up, even more so
Actually, then, that is probably something
we need Congress to start to cut back on spending were to raise taxes,
I would say, if you think about interest expanse, it's you,
depending on a year a few points of GDP in the context of a budget that around twenty point of GDP, so
Caesar adjustments that can be made if interest expense rises. Maybe it's worth a fraction of a point of view
be spending can be caught by that much taxes can be raised by that much so it's definitely
Annabelle, but it's something that is
are they going to influence fiscal policy making over the medium and longer term? More just because the debt stock is going to be larger right out
what's keeping an eye on by a healthy outlook for the economy, especially in the latter half of the year and good projections on unemployment. Thank you very much for joining us today, great to hear from you facts with vigour.
Now turned to Amelia Barnett from our global markets. Division for her
active on the ramifications for markets of all this stuff?
was familiar, walked back to the programme thanks, so much for having you, Jake saw in the wake of the passage
the stimulus bill were seeing strong performances across all markets, as we have since last year. Is this
rally than what we saw last year. Yes, I think the composition of the rallies wildly deference, in fact, if we think about the first line of the rally coming out a curve it that was led by a handful of stocks which had a disproportionate impact on the return to be asking p just by virtue
the market, tat waiting shaken, think the internet dominant brands. You are able to operate that businesses through the pandemic and also benefited from a low rates environment then take
November. Ninth when Pfizer announced that they had a highly effective vaccine candidates
and the nature of the Robbie ready change from that point. Suddenly,
he saw in best, is looking to play things most related to the vaccine,
reopening anti inflation, I think there's another thing
the hand as well, which is relevant to current market dynamics, which is the increase in retail
What which is needed,
into some wild price, swings inserting pockets of the market. I think that the com,
nation of increased banks.
At home and low rates has led these retail investors into non productive financial assets, and I was stimulus check sitting as well. I would exceed
his themes prevail. So Amelia markets go from
to value and value to growth. That's a classic rotation which phase we today its anti said. The dominant theme right now has been from great about it than to put numbers to it are valued basket, has actually outperformed our growth baskets by twenty five percent since those November
seen headlines, but if we kind of right down the legs of the move, as I do the two before immediately after covered the FED caught rates aggressive me and
embarks on this period of low rates in order to stimulate inflation and not let a fire
the long duration equities like high growth stocks and a handful of dominant tech companies that derive value long into the future, since the banks,
announcements, an ounce living in a world where we desperately trying to get back to normal retails reopening
travel alleges picking up and growth looks right to rebound and that's a great environment, environmental values and encyclical sectors like retail material,
an industrial as well as energy and financially, but, I would say,
strong run in value stocks needs. It is us at a pretty interesting juncture at the moment and I think a good example of that and what it looks like under the surface we now
alive and statement company that hasn't hosted the concept in twelve months, this training at all time high, despite the fact that the economy has an actually reopened
so seeing that kind of market exuberance is causing some to question whether or not this valley like has more to run and what the outside attention is from here and whether the lights of the fish stocks are actually more quickly
suppose than we necessarily thought so has them
It already praised in further stimulus and how does that balance?
with concerns about inflation. Yes, I think on your first question. I think the market certainly is prey
in the latest round of stimulus, you know, we all know that consumers are going to spend money in the economy and potentially directly in the stock markets and waste.
in these reopening and consumer exposed stocks and sick, because our form of late? But I think that, as we think about further stimulus which could come in the form of infrastructure spending, we know that there are set. You know, President Biden is telling you that he's gonna finance those speeches, stimulus packages through tax
eggs and so is not coming for free, and I think of investors are aware of that. As your question around him,
I am. This is a huge topic of discussion in the global markets, the vision, the patient,
we see inflation rise in the? U S and across the globe will have huge ramifications for monetary and fiscal policy and ask me
In a recent weeks when the market starts the price in the probability of higher inflation and subsequently rate hikes to if those great height surprised pretty quickly, it can have a pre damaging.
Impact on equity and credit valuations
but whether or not these inflation concerns are justified. One area
that we as a farm are pretty convinced that will see him
she materialise, he's in the commodities space, and so am I to spend two seconds outlining that, but essentially over them,
twenty years. That's really be no tax going into the old economy, setting the oil and gas sector, metals and mining all of those fresh dollars of investment.
Have gone into the new economy. Say things like tat by attacking telecom and the result is
We have a real lack of supply and the things that we need, like oil and gas relative to the demand for weeks,
to materialise when the economy turns back on and you can't just tat.
on oil, like that, you need to have prices rising
incentivize more supplied to come back into the markets. We
so now had stimulus aimed at the lower income bracket. You have a higher propensity to conceal animal commodity, intensive manner and shifting
globalization towards establishing
one's own supply chains to all of these factors, have huge inflationary forces that will impact both macro and my
I'm off it's. So you alluded to the growth in retail and some of the activity there should. We expect allow the stimulus checks to end up in the equity market and will that reignite some other volatility that we ve seen this year. Yet I think, as a great question and is highly topical. So over the next few weeks
backed around four hundred billion dollars of direct payments to hit american wallets across the nation and essentially me
equal share of that will end up in the equity markets. There have been various surveys and sat circulating
I'm sure people have seen that suggest that generally young people might put up almost fifty
center, best images checks into the acting market
Now, whether or not these numbers are even close, the troops and whether or not these flows,
The worthy materialised is about a question, but I would still say that this is enough
in and relevant dynamic the markets for two reasons. The first is that retail trading now accounts for almost as much body.
Miss mutual funds and hedge funds, combined to the retail impact is really mean.
it's all right now. The second is that there is a historical precedent when we saw the stimulus checks hit
Lastly, times around back in April in December of last year, the popular
retail names out informed and we saw huge cool volumes as well
on these same names. So I think it is important, but that said
Those who argue that a lot of these names have already started to reflect the signs of increase retail participation so does not necessarily clearly
the fallen through will come from
looking ahead were already hearing talk of a large infrastructure bill, perhaps financed a little bit by higher corporate and capital gains taxes to offset some of
investment there. How
as the market. Thinking about that possibility.
I already alluded to, I think investors are well aware that the infrastructure stimulus is now coming for free
President Biden has been very clear that a look to fund these stimulus packages through tax offsets, and I think in him
this means that does truncated the upside distribution, sir equity market, somewhat, that said manager so who many cross car.
in markets right now, and so I wouldn't
that this is a huge topic of discussion without funds, despite it becoming a more topical agenda item for the bided administration, in terms it just thinking about what is price into markets from corporate tax reform perspective, one way that we tracked it is to monitor our custom tax baskets.
that groups companies into beneficiaries and LA gods, indifferent tax regimes to back in twenty seventeen when President Trump cards taxes-
this basket move materially in favour of companies that have historically pay higher taxes,
and then in the lead up to the election last year, when the concept of higher taxes was very topical, we saw some of these twenty seven.
Maids rob ass of late swim,
we see no movement in this basket, which I think is surprising, given that
these murmurings from their Biden Administration are picking up, and I think we all agree that these does present. Downside risks taxi markets to suddenly a space.
the watch all right, we'll wait and see Amelia pleasure to have you want. We look for the haven't you back when your schedule permits, but thank you very much for joining us today. It's always finds a giant thanks so much
Stop will hear from Susie sure the chair
the global financing group in our investment banking division, she's got
about how stimulus is having an impact on corporations and how the corporates are thinking about accessing agreeing that capital markets in this environment. Susie's great to have you back it's great to see a jig.
or here you are both. Let's see we we spoken out Philips and Amelia Goin out about the impact of stimulus has had on the economy and on markets. Now, let's talk about the perspective from our corporate clients. How do you think
that the stimulus and its impact on corporates will change their outlook on growth and strategic activity blessings
it's really all about the impact of GDP and what people think happens going forward and your eyes. You know the magnitude of the support we seen in the. U S really can't be understated, there's never been anything like it with.
Nearly nine trillion injected into the economy. That's forty percent of! U S duty!
We have now reached the point where, if the total volume of stimulus for its own economy, it would actually be the third
largest economy worldwide. Only behind the US and China. That's just the stimulus, this
well, not only for consumer spending, so that'll affect corporates and they expect a consumption boom aspire,
in virus sensitive industries like Travelin Dining once we reopen, but it also just gives our corporate seals a lot of confidence to contemplate emanates. An invite.
stirs the competence to fund it and in fact we ve already
seen a pick up and emanate.
two thousand and twenty was a depressed year for MA. Only ninety three billion and volume versus two hundred and thirty billion on average annual in the last five years and we're going to see that return to normal and
Think it'll go beyond what we would call normal, so we ve already seen thirty billion in just the first two months. Have twenty twenty one and every day
emanate has announced and emanate- is also bigger. I think this year that it was last year so more deals,
good deals more so
doctors and ceos that are do something during covered, because there is so much uncertainly,
so I was more emanate, means more financing. What's the broader outlet for debt financing, what impact we seen on corporate issues?
in the grand scheme of things, development and credit spreads and the widespread pandemic easing have brought all in financing levels still very close to the all time tights at right around too in a corner, the investment great index is just fifty basis points away from the lowest levels ever that waste.
Earlier this year and coupled with the fact that
It's a very much recovering and unhealthy place today, kinds of
We been keen to opportunistic, we put forward their financing plans or at a minimum lock in today's low rates to take advantage of these levels, especially ahead of what people think
we'll be rising. U S. Interest rates and react
in two rising rates, potential
spread volatility, so
So U S. Supply is already up to four hundred billion euro date, which is up thirty, two percent for
is this time last year with issuers EVA capitalize, on the current dynamic. Although we know last year at this time, was the beginning of the covert related emergency liquidity financing. So that may even now it as we roll in two April and may
so. I have adequate financing. Last year was big year, furlano equity assurance. But how
think the levels this year will compare. I mean Jake
could he financing is the incredible story? We ve never seen anything like it. The rate of is already much higher than that seen in twenty twenty with a street pricing, almost seven hundred equity deals for two
twelve billion in volume. So far this year, verses. Just two hundred equity deals for only fifty four.
A volume you're debate last year, just passed the
If Q one were already up forty percent,
twenty twenties fiscal volume
and the real story is the IP o market, which is all
ready at sixty five percent of twenty twenty volume and that's driven by record speck activity, and I said I will try to get through at least one day every week, where I didn't say back, but there you go
I just said it would
stimulus package bolstering continued macro economic recovery are out
for U S, listed equity issuance is very strong and that's actually true across the beloved. Our rights,
financial markets are much better shape this year, much better shaped in the economy as a whole so far this year, so
do you see any headwinds to their relatively positive outlook? Shore?
I think you know the first had when people would think about. Is the evaluations are high, as the markets for looking at
now the markets like extra forward, looking taking account of projected earning
sal. You know more than normal and says
something that shakes this investor. Confidence in the ability of similar checks and vaccination
to facilitate economic recovery. Could down in this outlook
could be. A number of things could be one rising raids. Every time the tenure transact people get nervous. I don't they
people should be nervous. I think we ve got a lot of room all the way up to two percent
two percent, maybe good reason for the market to be nervous about rates and inflation. The second thing
anything around the virus could spook the market either noose around people about wanting to be vaccinated. Were you know, God forbid something
happening. That's negative, around vaccinations, negative side effects on Lena portion,
population, but listen, Jake, the? U S is already twenty percent vaccinated
first dose. So
what I think we would have seen that the other thing that could spooky
it is enough
for some reason, the more contagious
of the virus or some reason some other very admires develops, but I think those are corner
he says investors really want it on the market. They want own fast growing and disruptive companies backed by strong fundamentals and strong ip o cycles, increase the likelihood that companies you know we're gonna go public was a good, then the one other thing that you
don't worry about it
and I'll say back again that perhaps some
using either the regular way. I appeal process or this back process to go public too early and give those ip is began to underpin
warm. Investors may get dispute, but listen,
during all. These concerns is the fact that the rates are not being raised about had a market expectations. I think the market feels good about that, and investors just feel
about the possibility that were coming out of this global pandemic. You know any view,
Think about it. I almost think you could see and even
better market, because you know investors will really just humans and if you think about it, ass humans, we ve been locked in our houses for a year.
consumers go out and spanned and companies or more confident,
festers you're, just gonna feel better if you think about it. If you could just go,
while to dinner and then go to work the next day and all
equities you're gonna do that and so on very very bullish on twenty twenty one and forward
alright susie. We all look forward to getting out of our houses and offices so pleasure to have you on greater
you, Jake, thanks for having me
for we wrapped up last, but certainly not least, will hear from a. She shall go ahead of Goldman Sachs Asset Management, global, fixed income and liquidity solutions, business as usual
talk about the influx of standing into assets in the impact that will have on portfolios? Hasheesh walk under the programme so much for having Egypt a she's, the stimulus we ve talked about it
like here and combined with the improved economic growth and the prospects for
even higher growth, and the
the vaccinations investors
started away a little bit about a rise in inflation and interest rates. What does that mean for your take for fixed income and
authors and has your investment outlook changed sure. So the brighter outlook is without question impact. It fixed income
investors in the places you would have expected. First, the growth
exposed areas with floating real options like bank wounds that perform really well while longer duration, parts of the market that don't have as much rose, have lacked going forward. I'd say that this growth is can be really Jennifer. Product quality and steep you'll curve is most frank. Furs weapon
and really good opportunity for investors that wanted diversify away from some the gains that they built in that way markets and are afraid of rising rates. These steel curves are going to cushion
rate, rises that we might end up see over a long period of time, and if you want income, I'd say that high yield
once in the emerging markets represent great opportunities on ago four basis from here, so
stimulus package that the President just signed into law. The one point: nine trillion dollars includes a pretty significant amount of money. Three hundred and fifty billion dollars in relief for municipalities talk a little bit about how the funds might be used by state and local governments in the state of their finances. Today,
you're. So, as you know, this has been a really
challenging period of time for Saint local governments days had to deal with the problem
and reviews, particularly from state tax receipts and all
they ve had a lot of additional costs in dealing with the current crisis, whether it's off
food supplements work at it,
Airbus is around spools, etc, and so the first thing we expect them to do with this money, which is a tremendous
this amount of money to help replace their offers is to offset some of those costs that they ve gotten as well as revenue declines, but
as there are not allowed to use these funds for tax relief, we expect that these municipalities to both use the funds to strengthen up
their balance sheets and that's gonna, be in areas particularly hitting the statement. Local governments that
have had more challenges when it comes to access dead as well, is t really invest in parts of their interests
sure so areas, lights, schools, health care and transit
operations are really gonna, better shape it. When you think about that beheld impacts all of us. That means that there will be able to deliver
more and better services to their constituents and that's a fantastic outcome.
All right. Well, I look for the better subway service here in New York. What might be
implications for the money market be and the many investors. Given that backdrop, so this aid is coming at a time when revenues
we're already rising from the economic balance that we seen as well as stock market strength set. We ve been experienced, so it's gonna be a really positive trend for municipal credit, followed so
State model governments that have been under pressure from the rating agencies are suddenly finding themselves actually benefiting from
ratings or improved reading out. What's that's a fantastic thing? If hearings or folder my prosperous higher
Old names, as well as high grade names, the other thing you're gonna find is that as we look forward because their flesh with care,
State mobile issuers are not going to have to issue, is much, and so with
this issue is unlikely more demand because of the potential for rising taxes. We think you're gonna see really good performance from the meat sector, even in the face of modestly rising rates
and some. Finally, what might that influx of spending mean from messrs portfolios and how should investors think about navigating those changes? Investors are gonna benefit broadly and free years from a much healthier consumers that has come out of this crisis. The stimulus payments that have been made to consumers have really been helpful in shopping. Consumers deliver thereby
sheets pay back dead, p, back student dead and now those same consumers are looking forward in saying hey. Maybe I'm supposed to buy that house that I've been saving for worried about buying, as I had too much debt, so that's gonna be really positive in sectors like
housing as well as here,
areas that have been directly impacted by COBRA the service sectors that consumers haven't
label that participate with by China, desperate to engage with whether its
you're going on vacation were going out to a restaurant. I think you're gonna see just those services sectors, with a face to face sectors really do well.
At the same time, the concern you might have is that, in the face of that growth said, it's gonna be a challenge for investors, because the said
gonna wanna, slowly told me down, and what we heard from the FED and certainly heard it today, is that the said once the economy to get to full employment and actually to go beyond that to make sure that that full employment really is probably inclusive and that they're gonna keep rates, vary woe
The financial conditions vary terminated until they see inflation average closer to their target of two percent, and so that friendly said, is going to be really good fur
strict but forwards voracious. Thank you very much for joining us today sounds like a mostly rosy scenario. Looking forward to the next twelve months. That's for sure I write
you re much and thanks again to or other guests Alec Amelia in Susie
a very interesting discussion. That concludes
special episode of Exchanges- Goldman Sachs. Thank you very much for listening and if you enjoy the show, we hope you subscribe and Apple Pakistan liberating or common, and please
Turning later this week from weekly markets update this
guess was recorded on March, seventeen, eighteen and twenty second in the year
two thousand twenty one! Thank you for listening.
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Transcript generated on 2021-07-01.