Fade the Infrastructure Mirage

We are in the midst of an economic desert right now, wandering around and seeing various mirages in the form of hope for an immediate recovery. Bulls can point to the large cap tech names as their bread and butter, although as we discussed earlier today there are too many glaringly weak, important sectors which are not nearly as sanguine, namely the small caps, REITs, financials (large and regionals), insurers, and crude oil. 

With the likes of New York extending the economic lockdown at least another month (and, remember, that essentially takes us into Memorial Day weekend), there are too many known-unknowns as well as unknown-unknowns when it comes to exactly when the larger state economies in America open up as well as how traumatized the consumer is. Recall that America is the most consumer-driven economy in the history of Western Civilization, with leverage and debt the norm. A sizable chunk of that economic profile hinges on consumer confidence--Confidence not just to purchase a product or service but feeling safe about one's health prospects to venture into a given bar, restaurant, retail stores, casino, concert hall, arcade, cruse ship, airplane, etc.. 

Putting Americans back to work in the face of the largest surge in jobless claims on record is admirable, as Trump floats the idea of a $2 trillion infrastructure package to potential rebuild our long-in-the-tooth roads, bridges, tunnels, and airports, not to mention our seemingly-obsolete Amtrak lines. 

That is all fine and well in theory. 

But let's be honest: This is an election year and there will no doubt be political, partisan gamesmanship from both parties. I highly doubt this Bill gets passed or even close to passed before Election Day, let alone New Year's Eve. 

The infrastructure Bill and putting Americans to work to rebuild our country is a great idea in midst of economic calamity. But it is an issue for 2021. And as far as gaming it in the here and now, it is likely nothing more than a mirage in the middle of an extended lockdown desert.