Since last year we have held the view that the retail investor has piled into the riskiest assets whether they be cryptocurrencies or profitless, high-multiple Technology stocks. This retail phenomenon was powered in large part by Federal Pandemic Unemployment Compensation benefits (part of the CARES Act), which drew a new investor class into the market. What will happen to the riskiest of asset classes when those benefits dry up? Perhaps it has already happened to a degree. Recall that 22 states have opted out of the Federal Pandemic Unemployment Compensation program and the program itself is set to expire on September 6th (although we believe the Biden Administration will work to extend the program).
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