The Fed's Pause, and Biden Presents Another Plan

The Federal Open Market Committee of the Fed yesterday left the base rate unchanged in the range from 0% to 0.25% and kept the monthly rate of bond purchases at $120 billion. At the same time, the head of the Central Bank Jerome Powell once again confirmed that in the foreseeable future, the parameters of monetary policy will remain unchanged, despite the success of the vaccination campaign and the rapid recovery of the US economy.

Financial markets have received another confirmation that the holiday of cheap money continues and you can continue to buy everything that is on sale. For the sake of fairness, we note that despite the total overvaluation of the US stock market, companies such as Apple or Alphabet, judging by the latest quarterly reports, really have a reason to buy. Yesterday, for example, Apple reported a 54% increase in revenue over the same period last year. At the same time, all (!) segments of the company demonstrated double-digit growth. Well, the cherry on top for buyers was the announcement of a $90 billion share buyback program.

US President Biden tried not to fall out of the general festive context. In his first address to Congress, he unveiled a massive $1.8 trillion American Families Plan. In fact, we are talking about the practical implementation of the basic values ​​of the democrats - to redistribute financial resources from the rich to the poor. Biden's plan aims to help low-income Americans by raising taxes on wealthy Americans.

On the issue of inequality, but on a global scale. New York will lift curfews for bars and restaurants on May 17, and Delhi's mayor is trying to stabilize supplies of wood that is starting to be scarce as cremations continue to rise.