12/22/20: At long last, Congress has passed a $900 billion COVID-19 relief package. The nearly 6,000-page bill provides $600 to every American, adult and child, in households with incomes up to $75,000 for individuals and $150,000 for couples. The program also kicks in an additional $300 in weekly benefits to unemployed Americans for up to 11 weeks. While neither state and local support, favored by Democrats, nor business liability protection, favored by Republicans, were included in the final draft, the relief package adds nearly $300 billion to the Paycheck Protection Program, designed to offer forgivable loans to small businesses, and more than $50 billion to states to help distribute coronavirus vaccines.

This largely expected legislation was greeted with yawns on Wall Street for two reasons. First, many of the bill’s features were telegraphed over the last several weeks. The S&P 500 gained between one and two per cent last week in anticipation. Second, the whittled-down version of the House’s original bill is relief, not stimulus. That’s why economically insulated sectors, like technology, are two per cent higher over the last five trading days and cyclicals, like energy and industrials, trailed.

The COVID-19 relief package is welcome news for all Americans. In many respects, it has achieved what it was designed to do: replace income lost by those financially impacted by the stay-at-home orders, and facilitate the distribution of the vaccine. Great news for Main Street, but no fresh news for Wall Street.