Today, I'd like to provide an update on the coronavirus, including the economic and market implications. On the medical front, holiday travel effects have kept infection growth at high levels, and positive results also moved to new highs. Still, we should see vaccinations ramp up by the end of the month, and we could approach herd immunity as soon as June.

As expected, we saw a pullback in many coronavirus indicators over the Christmas holidays. But also as expected, the data has bounced back, indicating that the drop was due to slower reporting rather than an actual decline in cases. Looking forward, we still have another couple of weeks where infections due to holiday travel will show up in the data, and there are signs that is starting to occur. The next two weeks are likely to show continued case growth. While some sections of the country are showing improvements, we are not through this wave yet.

Today should be the day we see Washington start to turn blue. With the Congress meeting to count the inaugural votes and with the Georgia Senate runoff likely to show both seats won by Democrats, all three arms of government will be under control of the Democratic Party come the inauguration.

At the start of a new year, it makes sense to look back and see where we were, before looking ahead to where we are going. This year, doing this is especially important, given the significant changes we saw in December. But we start January in a very different place—a place with better news, better prospects, and lower risks.

December was a great month for the markets, with gains across the board. Unfortunately, we saw rising economic damage. Job growth dropped, and layoffs rose. Consumer confidence and spending also declined as the medical risks drove governmental shutdowns. Still, business confidence and spending were solid, and December's federal stimulus bill should help revive consumer demand.

As expected, we have seen a pullback in many pandemic indicators over the Christmas holidays. We are also, again as expected, starting to see the data bounce back, indicating the drop was more due to slower reporting than an actual decline in cases. Looking forward, holiday travel may well give us another surge, so take the current better news with a grain of salt. While a peak is coming, we are not through this wave yet, despite encouraging signs from the Midwest.

Today, I'd like to provide an update on the coronavirus, including what it means for the economy and markets. On the medical front, there were signs the third wave may be cresting, as both new cases and positive tests have ticked down. Further, people are now getting the Pfizer vaccine, and the Moderna vaccine will soon be available.

The third wave of the pandemic may be showing signs of a peak. While new cases remain very high, the seven-day daily average was down for two days in the past week, suggesting we may be close to a peak. Given the lag from Thanksgiving, that conclusion seems reasonable as much of the travel surge should be starting to play out, while control measures are becoming more widespread.

With the start of COVID vaccinations and signs that the third wave may be peaking, I have been thinking a lot about what the new normal will look like—and what it will mean for us as investors. We are not there yet, of course. But we can see the end of the pandemic in the not-too-distant future. Markets are already there, but markets tend to have a ready-fire-aim approach. So, there is still an opportunity to be thoughtful. Let’s walk through what the new normal might look like.

We’re nearing the end of a hard year, with the pandemic raging once again and the economy starting to slow. On the other hand, vaccines will soon be coming into play, companies are adapting, and there is the possibility of a spending boom next year. Despite risks ahead (e.g., the chance of another surge of infections with holiday travel), could 2021 be better for medical news, for the economy, and for the markets?