What’s moving the markets?

Pandemic causes economic freefall.

The markets are responding to the rippling effects caused by the continued spread of COVID-19. The broadening self-distancing and containment efforts of major global economies are having a profound impact on all levels of commerce. The economy has ground to a halt at the local, state and federal levels here in the U.S. with no end in sight. We have likely already entered a recession caused by a series of unfolding events we have not experienced in modern history. To say these are uncharted economic waters is a major understatement. The necessary response to stem the contagion and protect human lives around the globe is making freefalling economies a global reality.

Federal government’s response.

The response by the U.S. Federal Reserve and Congress has been swift and continuous. The central bank has thrown everything and the kitchen sink into the mix in an attempt to stabilize the bond markets and offer reassurances to the foundering economy. The U.S. government as a whole is committed to providing businesses and consumers the liquidity necessary to hang on through the current crisis. A third Congressional stimulus package likely to top $1.8 trillion is in the final stages of being hammered out. The ultimate legislative goal is to reassure U.S. consumers that help is on the way and will continue to be available.

Silver lining for investors.

The yo-yoing of investment markets will persist as this global crisis unfolds. Economic analysts will attempt to assess how demand will be impacted by increased unemployment, self-distancing practices, and rapidly changing consumer behaviors. Suitable investment opportunities will arise as we move forward. Habits, needs, and lifestyles will be very different as we emerge from this disaster. Many actionable investment ideas come from keeping an open dialogue with other people about their current situations, experiences, and perspectives. As daily life reshapes, we encourage you to reach out with your thoughts and opinions on how the world is evolving and what it means for the future.