Anyone who thought that the new year might come with a return to some sense of normalcy has been sorely disappointed. On the policy front, the year began with an attack on the U.S. Capitol building by protestors hoping to force Congress to effectively override the results of the presidential election. The political makeup of the Senate was finally decided by runoff elections in Georgia. A massive surge in post-holiday Covid infections occurred, ironically at the same time as the widespread rollout of vaccines. Globally, it became clear that a change in the calendar and a change in Washington did not mean that tensions with China and Russia would diminish, and problems on the southern border reemerged. Europe could not avoid trouble either, as Covid outbreaks intensified and worries about side effects of the AstraZeneca vaccine surfaced. In March, the Biden administration pushed through a new round of massive fiscal stimulus, including a targeted “helicopter drop” of recovery checks. The Federal Reserve emphasized its maximum employment objective and laid out a continuation of its dovish view of monetary policy. At quarter end, President Biden rolled out his infrastructure plan, with another big boost to spending as well as a tax increase on corporate profits.

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