Stimulus Conflict, Fed Goes Green, Home-Purchase Loan: Eco Day

Welcome to Wednesday, Americas. Here’s the latest news and analysis from Bloomberg Economics to help you start the day:

  • With a Democratic president poised to take office, Republicans are showing no willingness to spend the kind of money on a U.S. relief package that Democrats say is necessary
    • Joe Biden’s transition has turned to alumni from key federal agencies to prepare staffs and policies for the new administration. The agency-review teams focused on the economy and financial regulation includes former U.S. Commodity Futures Trading Commission Chairman Gary Gensler, who will head the group that is reviewing the Federal Reserve and banking and securities regulators
  • Applications for loans to buy U.S. homes fell last week to the lowest level in more than five months, suggesting the nation’s housing boom is facing constraints despite rock-bottom borrowing costs
  • The Fed expects in coming months to join the Network for Greening the Financial System, a group of 75 central banks set up to combat climate change by better understanding the risks it poses to economies
  • Secretary of State Michael Pompeo said the U.S. is “not finished yet” when it comes to getting tough on China, with just over two months left in the Trump administration
    • Tensions might be high, but Bloomberg Economics’ mapping of China’s financial links with the rest of the world suggests the chances of decoupling from the U.S. are low
  • Calculations by Bloomberg Economics show that by 2050, global gross domestic product would be $31 trillion smaller in a scenario that sees global ties splinter back to the level before China joined the World Trade Organization in 2001 versus one where the U.S. and other major economies commit to globalization

©2020 Bloomberg L.P.

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