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Laila Pence on TDA Network (02/19/2021)

Laila Pence Examines Consumer Savings In 2020
Laila Pence weighs in on interest rates, treasury yields, liquidity, and sectors to watch in 2021.

February 19, 2021

Do you think that there is going to be a detriment to equities moving forward? Or do you just think this momentum we see in equities won’t stop just because of higher interest rates?

I don’t think it’s going to stop because of higher interest rates. I believe they are still relatively low; they’re starting at such low levels, and they go up a bit, comparable to the growth that’s available in the marketplace and stocks.

I know you’ve got some charts on the amount of savings and the amount of liquidity out there on the street. What are your expectations with this amount of liquidity sitting on the sidelines?

In December, there was $1.4 trillion more in savings than there was in January of 2020. Those dollars are ready to go back into the marketplace. There’s such a pent-up demand. Every client I talk to can’t wait until they can get vaccinated to go out there and spend. We look at this year in two halves. The first half will get driven by the stimulus; there’s so much coming in with cash that it will prop up the market. The second half of the year will be for that pent-up demand with all that savings for people to go out and spend.

I’m hearing anywhere from 3% to 7% GDP growth in 2021. What are your estimates, and what do you expect?

We expect 5% GDP or higher. That is huge, and we expect another higher GDP next year—back-to-back high GDP. Of course, it’s coming off of a low level because of COVID, but that’s still huge; it will really help the economy and the marketplace because I know one of the concerns is always debt with the stimulus. If we can keep GDP and keep this growth going this year at 5 or 5 and a half percent, that will help the economy quite a bit.

Besides the e-commerce space, what other sectors are you looking at for further growth in 2021?

Of course, we like e-commerce, but we also like infrastructure. I do believe there is a bill coming, and this is an area that will help jobs and help the economy; it’s much-needed. We like anything to do with infrastructure. We also like the COVID stocks that were hurt because of the spending; we think those are poised to do well this year.

The opinions expressed are for general information purposes only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to making any decision.

All performance referenced is historical and is no guarantee of future results. All indices referenced, if any, are unmanaged and may not be invested into directly.

The opinions expressed in this material are those of Pence Wealth Management and do not necessarily reflect the views of LPL Financial.

Third party comments made within this communication do not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Laila Pence is a registered representative with, and Securities and Advisory Services offered through LPL Financial, a Registered Investment Advisor. Member FINRA/SIPC. Financial Planning offered through Pence Wealth Management, a registered investment advisor. TD Ameritrade Network, Pence Wealth Management and LPL Financial are separate entities.

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