How many stimulus checks ended up in the stock market?

(From Seeking Alpha) Direct payments have provided a financial lifeline to millions of Americans, but for others, they represent an opportunity to boost their savings. That is thanks to the $2.3T CARES Act and the latest $908B stimulus bill, which provided $1200 and $600 to all Americans making under $75,000 - regardless of their employment and financial situation.

In fact, securities trading was among the most common uses - across nearly every income bracket - for the government stimulus checks issued in May, according to software and data aggregation company Envestnet Yodlee. For many consumers, trading was the second or third most common use for the funds, behind only increasing savings and cash withdrawals. In fact, Americans that earned between $35,000 and $75,000 annually traded stocks about 90% more than the week prior to receiving their stimulus check.

Quote: "Where are the Robinhoodies going to invest their newfound wealth?" asked Mark Tepper, president and CEO of Strategic Wealth Partners. "Of course they're going to buy a 10th of a share of Tesla (NASDAQ:TSLA). Of course they're going to buy a sliver of Bitcoin (BTC-USD)."

The trend also illustrates how the fallout from the pandemic is dividing the U.S. economy. Claims for unemployment benefits averaged 1.45M a week last year, compared with about 220K in 2019, while at the same time the percentage of disposable income that households managed to stash away has increased, property prices have jumped and the stock market is soaring.

"I would rather support those that do not have a job. We don't need the $1,200 check to everybody anymore because a lot of those people have now found work," Kevin O'Leary, chairman of O'Shares ETFs and Shark Tank investor, said before the latest coronavirus aid package was passed by Congress. "I would prefer to have a transitional support unemployment for those that are leaving industries and sectors that are out of favor, like movie theaters, airlines, cruise ships and certain restaurants that are never going to come back."

Go deeper: There might be more direct payments in sight. Stocks ended at all-time highs on Friday after President-elect Joe Biden said he was assembling a multitrillion-dollar relief package that would boost stimulus payments for Americans to $2,000.

Comments

Popular posts from this blog

One more time: The difference between rich and poor

The Hidden Agenda Behind the Global Warming Hysteria

This Pattern is Another Warning Sign