COVID-19: U.S. Stock Market
Due to recent pandemic COVID-19, the US Stock market has undergone one of its worst quarters ever. Businesses everywhere have been shutdown or put on suspension due to the immense outbreak of positive tests. The Dow Jones Index recently had its worst first quarter in history. It's easy to say that the economy has taken a massive blow from the pandemic. The IMF believes that 170 countries or more will witness a decrease in their per capita income this year. Although the stock market is looking rough right now, economists have discovered a v-shaped recovery coming for 2021. If the economy does indeed sky rocket in 2021, it will create a huge support boost for the next president and should get the US back to normality. If the economy doesn't undergo a jurassic improvement during the early parts of 2021, should we be worried about another recession?
Mohit Oberoi, C. (2020, April 13). COVID-19 Impacts US Stock Markets and Economy. Retrieved September 04, 2020, from https://marketrealist.com/2020/04/covid19s-impact-on-us-stock-markets-economy/
It's interesting to see the stock market crumble from a consumer standpoint. Watching stocks fall gives a lower risk factor to purchasing which could lead to profit if you have patience. Industries COVID impacted hard like cruiselines, airlines, or cinema could all skyrocket when the world reopens.
ReplyDeleteDuring the pandemic was a great time for new investors to enter the stock market due to the record low prices. I do expect the stock market to recover and I liked your point about that helping the next president.
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ReplyDeleteWhile the stock market may well rebound quickly in 2021, the so-called "real economy" will likely lag far behind. Stock values are largely a product of investor expectations about the future, which can fluctuate rather quickly (as we've seen throughout the pandemic). But GDP and unemployment depend on more than investor confidence. Firms' decisions to hire and produce will take far longer to implement than stock prices take to change, thus overall economic recovery will likely not take a dramatic V-shaped form.
ReplyDeleteThe stock market will definitely recover a lot faster then the economy and even now with thing starting to go back to normal slowly, it is still a absolutely great time to get involved in the stock market because the prices are still low compared to before COVID and they will definitely rise
ReplyDeleteEven before this pandemic, the stock market had been on one of the strongest bull runs of all time. It has performed unbelievably since the financial crisis in '08 - '09. While no-one saw this pandemic coming, the stock market did need a healthy pullback, as many stocks were highly overvalued. The market has actually bounced back better than I expected since March, but with all of the uncertainties with the vaccine and presidential election, it is hard to be confident it will rebound in 2021.
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