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What Is the 2020 Census and Why Does it Matter?

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Every ten years the U.S. Census Bureau tries to estimate how many people reside in the country. The year 2020 is one of those years.

This has a very indirect impact on financial markets, but it matters nonetheless.

First off, 2020 is the 24th Census in history. Census Bureau workers literally knock on the doors of residences and collect as much information about the people living there as possible. This includes demographic information like age, gender and race and ethnicity. People can also “get counted” by going to the Census website and filling out the questions.

But what’s the point of all this?

When the Census Bureau collects all of the information it needs, the federal government essentially has a recommendation on how much money should be allocated to different projects like infrastructure, social welfare programs, medicaid and how much money is allocated for state funds.

These are base recommendations, purely based on the merits of societal needs. Funds are appropriate by Congress, which is a political institution and the Congress men and women will vote for funds to be allocated (or not allocated) to certain projects based on their political agendas, but they do need a foundation that enables them to first understand what is actually throughout the country needed. When funds are appropriated, agencies execute agendas. The Small Business Administration, for example, has been a key agency in 2020, as it is responsible for executing the Paycheck Protection Program, which was instrumental in aiding the fast economic recovery from the pandemic.

The market impact of al of this: the dollars allocated to unemployed people will aid consumer spending, infrastructure projects will either get a boost or a drawback, which impacts manufacturing companies and so on. 

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