May 2021 Outlook and Insights
Looking Ahead
- Consumer price inflation (CPI) is likely to remain low for years. Cost control factors keeping CPI in check include: 1) continued global trade, 2) savings from online shopping, and 3) productivity gains from automation, digitization, wi-fi applications, and remote work.
- Consistently increasing stock prices can be summed up with the old adage, “Don’t fight the Fed"; meaning monetary stimulus tends to drive stock prices higher. The current S&P 500 10-year PE ratio of 38x is almost double the past 70-year average S&P 10-year PE ratio of 20x. How much higher might stock prices go?
- Proposals for a higher capital gains tax have an increasing number of business owners talking to their trusted advisors about a potential sale of their company in 2021.
Looking back
- Texas’ mid-February "Deep Freeze" took 75% of ethylene capacity off-line, which is still causing supply chain shortages. Ethylene is a key ingredient in many products including plastics, refrigerants, and building materials. 85% of the US supply of byproduct polyethylene is made in Texas.
- 63% of 2020 Paycheck Protection Program (PPP) recipients have submitted applications. So far, 99.7% of the 2020 PPP loan balances have been forgiven.
- You needn’t look any further than the sparse selection on car dealer lots for evidence consumers are freely spending stimulus checks. April 2021 auto sales were the highest since 2005.
Resources, recommendations, and reminders
- 70% of businesses experience some form of employee theft. Listen or watch our recent Sharing Knowledge Series video and podcast to learn how to protect your company: “Cybersecurity: Protecting what matters to you”. For a free review of your company's cash access and security controls, contact Chris Anzevino, Commercial Banking Development Officer at 440.764.8165 or [email protected].
- SBA will pick up the tab for 3 loan payments and guarantee up to 90% on new qualifying SBA loans through 9-30-2021. Contact Hallie Sobieraj, Commercial Portfolio Manager at 330.493.5153 or [email protected]. Learn more about SBA 7(a) loans.
- 41.4% Ohioans now vaccinated. Visit the Ohio Department of Health website for Ohio's latest COVID-19 metrics
About Westfield Bank
Westfield Bank has grown to $1.9 billion in assets and serves 25,000 customers throughout the NEO regional metro area comprised of Cuyahoga, Mansfield, Medina, Stark, Summit, and Wayne counties in addition to providing insurance premium financing, loan, and deposit services to independent insurance agencies and RIAs across the US.
Westfield Bank's vision and strategies are built on a “mobile-first” platform providing real-time, secure, cloud-based, comprehensive digital loan, deposit, and payment capabilities.
Westfield Bank, a 2020 recipient of two awards for best places to work, is the 9th largest of 171 community banks headquartered in Ohio.
The information contained herein is provided for informational purposes only, and should not be construed as advice on any subject matter. You should not act or refrain from acting on the basis of any content herein without seeking other professional advice. Any statistics contained herein have been obtained from sources deemed reliable, but the accuracy or completeness of the information cannot be guaranteed and is expressly disclaimed. The information herein is information of general nature, and may or may not address your situation. As such, the author and Westfield Bank disclaim all liability for actions you take or fail to take based on this information.
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Hyperlinks needed for resources section:
https://www.westfield-bank.com/sharing-knowledge-series/cybersecurity