Goldman Sachs may not be so bullish on the near-term path of the U.S. economy, but it is bullish on you getting another stimulus check in the mail from Uncle Sam this year.
“Our forecast assumes one more round of payments similar to what the bill proposes,” Goldman Sachs strategist Jan Hatzius wrote in a note Wednesday, referring to the new $3 trillion relief plan put forward by House Democrats on Tuesday. Under the proposal dubbed the HEROES Act, a second round of checks would include $1,200 per family member and up to $6,000 per household.
In the first relief package called the Coronavirus Aid, Relief, and Economic Security (CARES) Act, individuals were eligible for up to $1,200 (depending on income level) or $2,400 for married couples. Children under 17 were granted $500. The HEROES Act would offer dependents $1,200 per eligible household for up to a maximum of three dependents.
If passed, the new legislation would mark the largest relief plan in history. But it’s unlikely it will pass a Republican controlled Senate in its current form. The Senate has downplayed the need for another sizable stimulus package as states reopen and the economy kicks back into gear.
Goldman believes a scaled down relief plan is likelier before year end.
“We continue to expect another $1.5 trillion in fiscal measures over the course of 2020-22, with about $550 billion in 2020. Without an obvious forcing event this month, we do not expect Congress to enact the next round of fiscal measures until late June,” Hatzius wrote.
Goldman thinks the next round of fiscal stimulus will include: (1) more stimulus checks to households; (2) state relief; (3) extra extended unemployment benefits; (4) extension of employee retention tax credit.