Now that the election is finally decided, what does that mean for the economy? Biden’s plans include ambitious government spending on energy & infrastructure. The longer form details from Moody analytics can be found here. Joe’s ability to impart policy change will be partially predicated on the undecided senate elections.
- The Biden jobs and infrastructure plans are designed to eventually achieve net zero emissions while boosting job creation and growing the economy.
- A major goal is to help small businesses while holding corporations more accountable.
- Another major goal is to address the pandemic starting on Day One of the Biden administration.
- The infrastructure plan is designed to address climate change while building a new, eco-friendly infrastructure ranging from transportation to energy to automobiles and more.
- The net cost of Biden’s economic plan is expected to be $2.6 trillion by 2030.
Rates – improved slightly after election day uncertainty only to lose most of their gains by week’s end. Rates are down 1% from this time last year.
Jobs – there were strong job gains in October, a total of 2.2M new jobs were created (many new folks entered the work force as well). We are still roughly 9M short of pre-pandemic job levels. The unemployment rate dropped nicely to 6.9% (down 1%) but if you factor in people that are marginally attached to the labor force & part time workers for economic reasons the number is closer to 12.1%. Average weekly earnings are up 5.7% on a year over year basis. The number of people filing for unemployment for the first time remained steady at 0.75M.
Home Sales – while the number decreased by 2.2% in September from August, sales are still up a whopping 20.5% year over year. Historic lack of supply is tempering sales.
Mortgage Application – volume is up 3.8% from the previous week. Purchases are up 26% year over year and refinances are up 88% year over year.
Forbearance – the share of mortgage loans in forbearance decreased to 5.83%. This marks 21 consecutive weeks of declines for conventional loans (3.66%). Nearly half of the borrowers exiting forbearance have ‘reinstated their mortgages’ paying back any amount of payments missed. As a reminder if you are on a forbearance plan and would like to get a new conventional mortgage you will need to ‘reinstate’ your current mortgage, or go into a re-payment plan and make 3 consecutive payments before you can qualify.