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The stock market is commonly considered to represent what the economy is expected to look like in 6-12 months. If we assume a sharp downturn in Q1 and Q2 of 20
by BjoernKW 7y ago
The stock market is commonly considered to represent what the economy is expected to look like in 6-12 months.
If we assume a sharp downturn in Q1 and Q2 of 2020 and a subsequent uptick and prolonged recovery in the second half of 2020 and continuing in 2021 that pretty much corresponds to how stock markets have been reacting over the past few weeks.
- jazzyk 7y agoNo, it is just helicopter money distributed (to some) by the Federal Reserve. "Whatever it takes" to backstop the stock market is apparently working.
- BjoernKW 7y agoWell, while I don’t disagree that the current “Whatever it takes” influx of money helps with propping up the market right now there’s nothing that inherently prevents the economy from growing again once the immediate crisis is behind us. Make no mistake, there will be huge shifts and upheavals, regarding the ways we work and buy stuff for example. Many of today’s incumbents might not exist anymore in two years’ time but there’ll be others to take their place.
- jazzyk 7y agoYou make sense, unfortunately our "market" economy does not. Many of today's incumbents WILL exist in two years' time, because they are the recipients of "helicopter money" to prop them up, even if they deserve to die. The real losers will be small and medium businesses who will get some token (not enough to survive) help, so that politicians can claim that everyone was helped.