(ConservativeInsider.org) – In March 2020, our nation’s economy hit close to rock bottom as COVID-19 shutdowns began. But, the S&P 500 has been able to rally since then and even finished 87% better than that record low on Thursday, April 29. However, it seems that this bullish market may be slowing down as President Joe Biden announces his federal government spending binge.
President Biden Inherited the Current Economic Recovery
Few people could have rightly predicted the radical changes the coronavirus would make to our economy and the nation at large. But, former President Donald Trump did everything in his power to limit those changes and put America first through the recovery process. To that end, he expedited two vaccines for Emergency Authorization Use (EAU) and jump-started the economy through stimulus checks.
This recovering economy is the one Biden inherited when he took office in January of this year. But, now that the President has had his first 100 days in office, the economy is slowing down as Biden’s expensive plans take shape.
Headwinds Are Forming to Slow the Stock Market
Biden’s infrastructure plan has been the talk of Washington for a few weeks now. But, as the proposal actually begins to move forward following his speech to the joint session of Congress, the stock market is getting a bit hesitant.
Businesses are unsure of just how Biden will pay for his proposed $2.3-trillion infrastructure plan, as most proposals include raising the corporate tax rate from 21% to 28%. Understandably, many companies are hesitant to make risky moves with such uncertainty.
David Rosenberg, the chief economist at Rosenberg Research in Toronto, Canada, noted that the stock market is likely going to make “a very serious correction” in the next year after the overwhelming gains it’s made in the past few months. He also said the S&P 500 will likely be approximately 16% lower than what it could have been if Biden raises corporate taxes to fund his infrastructure bill.
Our Economy Could Still Make Its Comeback
While experts are warning of some slower months ahead for the stock market, we must note that the United States is resilient. Our nation has made an incredible recovery from a pandemic thus far, and hopefully, government spending in the coming months will not cost us our recovering economy.
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