“Prosperity brings expanded lending, which leads to unwise lending, which produces large losses, which makes lenders stop lending, which ends prosperity, and on and on. . . . Look around the next time there’s a crisis; you’ll probably find a lender.” ― Howard Marks

1. Corporate America Reacts to Capitol Hill Riot With Donation Pause — a growing list of U.S. companies are suspending or re-evaluating how they choose to make contributions to political candidates as pressure grows on them to distance themselves from the mob that stormed Capitol Hill. Among the companies that paused political giving was America’s largest bank by assets, JPMorgan Chase, which gave $5.3 million to candidates over the course of the 2020 election cycle, according to federal filings.
Marriott and Dow said that they will stop donations to Republicans who objected to President-elect Joe Biden’s victory being certified. Hallmark is asking Senators Josh Hawley of Missouri and Roger Marshall of Kansas, both of whom objected to Biden’s certification, to return the $7,000 and $5,000 the company donated to their respective campaigns.
2. Europe Steps Up Defenses Against New Covid Variants — new, aggressive mutations of the coronavirus first discovered in the U.K. and South Africa are forcing governments to increase the severity of lockdowns and other restrictions, and prompt a clampdown on rulebreakers. The new variant has already been detected in countries such as Germany, France, Spain, Ireland and Denmark, with some requiring negative Covid tests from inbound travelers. The French prime minister refused to rule out the possibility of a third national lockdown. The government has so far stopped short or such a step, contrary to most other EU countries. But a national curfew is already in place, along with the closure of bars, restaurants and public venues.
3. President Trump Impeached for the Second Time — the House voted 232 to 197 to impeach President Donald Trump for “incitement of insurrection” in connection with the Capitol riot that left five people dead. The vote was largely along party lines, with 10 Republicans joining House Democrats in support of the resolution.
This is the first time in American history that a president has been impeached twice. Trump was impeached on Dec. 19, 2019, for abuse of power and obstruction of justice related to his actions to pressure Ukraine to investigate the business dealings of Hunter Biden, the son of now President-elect Joseph Biden. The Senate will wait until after Joe Biden is inaugurated to begin its trial. “There is simply no chance that a fair or serious trial could conclude before President-elect Biden is sworn in next week,” Senate Majority Leader Mitch McConnell said in a statement.
4. Biden Set to Announce 100 Million Shot Plan — President-elect Joe Biden on Thursday will unveil details of his plan to deliver 100 million Covid-19 vaccine shots during the first 100 days of his term Thursday, as the U.S. remains far behind its rollout plan. Over 10 million Covid-19 vaccine doses have been administered to Americans so far, putting the U.S. on track to fall well below the 50 million doses by the end of January that the Trump administration had aimed for. To increase the pace, Biden has said that he wants to invoke the Defense Production Act to boost vaccine production, establish mass vaccine sites run by the federal government, and increase the funding being sent to state and local governments to help pay for their rollout efforts.
5. Biden Outlines $1.9 Trillion Stimulus and Vaccine Program — President-elect Joe Biden unveiled a $1.9 trillion stimulus and vaccine distribution plan in a Thursday night address from Wilmington, Del. “A crisis of deep human suffering is in plain sight,” said Biden, who drew attention to the growing divide between the wealthiest Americans and everyone else. “We have to act and we have to act now.” To that end, his American Rescue Plan includes direct payments of $1,400 sent to most Americans, bringing the total delivered in a second round of checks to $2,000 including the $600 payments passed in December. It also extends federal unemployment insurance through September, increases them to $400 a week and raises the federal minimum wage to $15 an hour. Biden is also calling for $350 billion in aid for state and local governments, $170 billion for schools, and $70 billion to fund Covid-19 testing and vaccination. To support small business, he is proposing a new $15 billion grant program plus $35 billion for low-interest loans and early-stage capital for entrepreneurs.
6. Taiwan Semi Is Betting Chip Demand Will Keep Rising — chip maker Taiwan Semiconductor said it would spend $28 billion to boost production capacity to meet the growing demand for its chips. 5G smartphone launches and Taiwan Semi’s next-generation processor technology, which Apple uses in several of its computers, helped the company report fourth-quarter net income of $5.01 billion with sales rising 22% to $12.7 billion. Executives’ comments on an earnings call suggest that the company would increase capacity investments by about 50% compared with 2020. A weak 2019 saw low levels of production investment in the industry last year that, combined with Covid-19 shutdowns and surging demand from videogame consoles to cars, led to global shortages.

The week ahead — Economic data from Econoday.com: