It was a strange contrast this week between massive protests, riots and looting in America’s streets while the stock market was soaring to new highs. The news media was consumed with all of the legitimate outrage over the death of George Floyd at the hands of the Minneapolis police. But many peaceful protests quickly turned violent and led to widespread looting and destruction in many American cities. Investors hardly seemed to notice all of this turbulence, and bid up stock prices aggressively.
The number of Americans filing for unemployment rose by another 1.9 million, bringing the total to a staggering 42 million in the last 11 weeks. The unemployment rate for May jumped to over 20% as over 8 million Americans lost their jobs. These numbers are approaching the highest levels since the 1930’s Depression. The number of corporate bankruptcies soared by 48% over a year ago. Big companies including JC Penney, Neiman Marcus, J Crew and Gold’s Gym all filed and many more are expected. Many small businesses that had suffered while having to close because of the pandemic got destroyed by looting and may never come back. To counteract this weakness, the Federal Reserve continues to pour trillions of dollars into the financial system and the European Central Bank announced it would pump an additional 1.3 trillion euros into European markets. There was some hope that Congress would pass another rescue package, but it is very unclear if that might happen and what would be in it. So why are stock prices jumping to new highs? Because the economy is reopening, the coronavirus pandemic seems to be easing and all of the stimulus from central banks around the world is providing liquidity to buy stocks.
For the first time all year, the initial public offering market picked up with both Warner Music and ZoomInfo stock surging after they started trading. If you are thinking of getting into stocks to ride the wave, the best sectors are technology, such as Microsoft, Facebook and Google and healthcare stocks like Merck, Pfizer and Regeneron which all stand to benefit from any coronavirus vaccines and treatments.
One question I have been getting lately is how someone with a high interest rate on their car loan can refinance to a better rate. If you are one of the many people whose income has been cut sharply, you should do what you can to cut your expenses and avoid getting your car repossessed. Two of my affiliates at moneyanswers.com can help you lower your auto loan rate quickly online. Go to myloangen.com or My Auto Loan.com and fill in the applications to lower your rate or extend your loan’s payoff date so you can lower your monthly car payment.
My Loan Gen: www.myloangen.com
My Auto Loan: https://tinyurl.com/yctp6f72
As a personal finance expert, Jordan recognizes quality solutions, forming affiliate relationships to help improve people’s financial lives.
