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Breitbart Business Digest

3-4 minutes

Today's Top Stories From the Breitbart News Desk

American consumers are feeling both grimmer and brighter about

the economy. The Federal Reserve Bank of New York released, on
Monday, the results from its January survey of consumers. It
showed that American consumers increased their expectations
that the unemployment rate will be higher one year from now. At
40.2 percent, this is now the highest it has been since the March
and April shutdown. Yet the same survey shows that consumers
think the odds that they personally will lose their job in the next 12-
months have fallen.

What gives? We're inclined to think that people are typically better
at assessing their own economic situation and more susceptible to
media influence and political rhetoric when it comes to national
trends. This suggests that while the economy is actually improving
in many areas, the weight of the "dark winter" talk from President
Biden and Treasury Secretary Janet Yellen is weighing on the
minds of the American people.

Over the weekend, yet another star liberal economists came out
against the Biden plan to spend $1.9 trillion. This time it was MIT
professor and former IMF chief economist Olivier Blanchard, one
of the most cited economists in the world. He said that the hole left
in the economy from the pandemic is likely to be around $900
million and noted that the CBO has a figure around half that.
Adding another $1.9 trillion to the $900 billion authorized by
Congress in December risks not just overheating the economy,
Prof. Blanchard warned, but setting it on fire.

The objections to the bill from Blanchard and Larry Summers

make it more likely that Biden's White House will have to tone
down the spending in the bill to win enough votes to pass it. With
the Senate evenly split and the Democrats holding just a narrow
majority in the House, they cannot afford defections. And with
establishment liberal economic heavyweights raising the alarm
about overspending, it will be hard to muster the votes needed
unless some moderation is introduced.

Speaking of moderation, it was not to be found in global financial

markets Monday as the major indexes hit new highs. Elon Musk's
Tesla announced it had purchased $1.5 billion dollars of Bitcoin on
Monday, sending the price of Bitcoin and Tesla shares soaring. A
rough, back-of-the-envelope calculation suggests that Tesla's
market cap jumped by around $10 billion and the value of its
Bitcoin holdings jumped around $240 million. As Charley Grant of
the Wall Street Journal put it: "GameStop mania was a wake-up
call, but now the capital markets have truly reached ludicrous
mode."

– Alex Marlow & John Carney

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