Welcome to the Weekly Scan. Here’s what we’re following for the week of July 27, 2020.
Make sure to check back as we update these stories.
Vaccine hopes spring eternal. The joint venture between Biotech company Moderna and the National Institute of Health announced its first large-scale test of a Covid-19 vaccine would begin this week. The Phase 3 trial will involve 30,000 U.S. citizens who have enrolled in the experiment. Half will be given the test vaccine, the other half will get a saltwater placebo. The goal is to see if the vaccine creates a lasting immune response to the novel coronavirus that can prevent illness.
- The takeaway. Moderna is one of five companies, including Oxford-AstraZeneca, Johnson & Johnson, Merck, and Pfizer, that have already received approximately $2.2 billion from the federal government for vaccine development. Moderna has never successfully brought any of its treatments to market.
Republican relief plan. Senate Republicans are set to release their financial relief package Monday. It is expected to be a more modest version of the plans approved by House Democrats earlier in the month. Estimates are that the relief package will be about $1 trillion, compared to a $3.5 trillion aid package approved by the House. The Republican package is expected to contain another round of $1,200 relief checks, and continuation of an expanded unemployment benefit, but at a lower level.
- The takeaway: An expanded unemployment benefit of $600 is set to expire at the end of July, 2020. Approximately 18 million people are currently unemployed, and additional federal support is widely viewed as necessary to keep the economy functioning. Democrats believe that much more economic support is vital. Their bill includes $1 trillion in aid to states and local governments, as well as more money for schools, health spending, housing, and elections, as well as infrastructure.
The gold bug. The price of gold reached a record high of $1,944 per ounce on Monday, July 27. The previous record price of gold was $1,921 per ounce, set in 2011. The price of gold has increased 27% in 2020. A few different factors reportedly contributed to the record price, including the recession, increasing tension between the U.S. and China, the decreasing value of the American dollar, and low interest rates.
- The takeaway. Since market volatility started in March, investors have flocked to gold since it can seem like a safe investment during times of economic uncertainty. Gold experienced similar price increases during the 2008 recession. Good to know: Gold is a volatile investment, and you can lose money when you invest in it.
Home sweet home. In June 2020, purchases of new homes in the U.S. reached their highest level in almost 13 years. Home sales increased 13.86% to an annual pace of 776,000 homes. Increases occurred in all regions of the U.S., with sales in the Northeast increasing 89.7%. The median price of a home increased 5.6% to $329,200 from 2019, as the supply of available homes decreased.
- The takeaway. During the Covid-19 pandemic the Fed has slashed its benchmark interest rate to near 0%, making mortgage rates more attractive. The average 30-year fixed mortgage has decreased to a historic low of 3%, making financing potentially more appealing to prospective homebuyers. Additionally, renters might be choosing to leave cities for the suburbs as working from home becomes more common—and in some cases permanent—for some employees.
Find out what we covered in last week’s Scan.