The Fed kept rates steady. More interesting is the updated Fed’s projections for the economy. Below are a comparison of GDP growth (as percent of 2019 GDP) and the unemployment rate.
You can see even at the end of 2021 the Fed does not think we’ll be back to 2019 GDP. At the end of 2022 we won’t be back to 2019 unemployment.
These projections suggestion a very long recovery.
One of the my theories about this recession is the rules and support may be favoring big business over small business. Stock market returns backup this thinking.
Here’s the stock market returns since February for Small-caps (IWM), mid-caps (MDY), large-caps (SPY), and Mega-caps (OEF).
You can see how large and mega cap companies have been leading the charge.
This is unusual. In past recessions, small and mid caps lead the way. Here are the returns from the tech bubble.
And here are the returns from the financial crisis.
These results suggest the bailouts and rules favor big business over small. If we had private mom and pop businesses on here, I think the results would be even more dramatic.