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May 7, 2020

Market News – Spring 2020

Spring 2020 Quarterly Newsletter

Author: Kristopher W. Carroll, CFA®, CFP®

 

It has certainly been an eventful few months since I last wrote this column. The year started as a continuation of a strong 2019, before worries over the coronavirus led to quarantines and business shut downs led to the fastest recession in history.

 

This is a truly unique situation, but we are reminded that the four most dangerous words in investing are “this time is different.” All recessions and all bear markets are unique. Up to this point, markets experienced an incredibly short but drastic move lower and bottomed on March 23rd. Although we have seen a significant recovery from those lows, we expect that economic news will continue to worsen for at least another month.

 

As I am writing this on April 15th, we have seen the three worst numbers of new unemployment claims in history over the last three weeks. We expect in the short term that unemployment may spike over 15% and that additional economic data will continue to paint a very bleak picture. Many are left wondering what the recovery will look like.

 

We believe that the actions of the Federal Reserve and our government, while extreme, were necessary to smooth this economic slowdown. It may still take several quarters for the economy to recover. Volatility will always create opportunity and there will be winners and losers that emerge from this recession. We will do our best to keep you informed of our thoughts. Please do not hesitate to contact us if you want to discuss the markets, your account or more importantly, your long-term plan.

 

This article was featured in our Spring 2020 Quarterly Newsletter available here:

Market Update, Market Volatility

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