Goldman Sachs say that ina addition to the $1.9tln approved last week
- the next round of fiscal legislation … our economists (expect) a package that will include at least $2 trillion in infrastructure spending and could reach $4 trillion if it also funds health care, education, and child care initiatives.
I do not know how the Fed can hold back rate hikes if another $4tln flows into the economy in fiscal aid.
GS do add though:
- Our economists expect the next package will be paid for in part by higher tax rates
So that’ll be some subtraction.
More from GS:
- The tax plan proposed by President Biden in his election campaign would raise the statutory corporate tax rate on domestic income from 21% to 28%, partially reversing the cut from a rate of 35% passed in the 2017 Tax Cuts and Jobs Act. The plan would also raise the tax rate on foreign income (also called the “GILTI” tax) and institute a minimum corporate tax rate.