We're already in a 'small business recession,' says Ironsides Macroeconomics' Barry Knapp (youtube.com)
3 forms of stimulus and 1 form of restriction (policy rate) in place.
$3t in bank reserves, pressure on back end of balance sheet (holding rates 1% lower than other), and running 7% budget deficits in government spending and 24% of GDP.
‘If you’re a household that holds assets, large non-financial corporate, or big publicly traded homebuilder that can finance out the curve, policy is easy. If you're a small business that borrows at a floating rate or smaller bank that where your return on equity is half of that of the large bank, policy is tight.'
In a strong economy, no one cares about stock valuations. Current economy is strong. In weak economy, valuations matter to investors. In strong economy, story matters. In weak economy, balance sheet matters. Eisman.