Succinct Summary: We are clearly in a recession with very low visibility on how we are going to come out of it. Companies are also seeing consumers move away from credit as they also shift away from discretionary spending. On the positive, there are some promising signs of recovery as shorter cycle businesses like auto come back.
Succinct Summary: This week was the height of earnings season and it was a little surreal to see the magnitude of revenue declines in some industries. These declines weren't surprising though and many companies said that there were signs of recent stabilization. However, markets have pinned hopes on a V shaped recovery. If we don't get a V there could be a second wave of volatility. The most concerning data point from this week is that China and Italy are experiencing U shaped recoveries. Editor's Request: This weekly newsletter is made possible by donations from our readers. If you like what you are reading, click here to donate (Our suggested donation: $10 per month). Help us keep The Transcript going.
Succinct Summary: It is quite clear by now that we are in a recession. The hope is that this is a different kind of recession and that we will be out of it quickly. But that depends on the trajectory of containing the virus. The good news is that things in China look better after containing the virus. Editor's Request: This weekly newsletter is made possible by donations from our readers. If you like what you are reading and want to help us keep it going, click here to donate (Our suggested donation: $10 per month).
Succinct Summary: The Coronavirus continues to spread globally and no one knows how bad this could get. On the one hand we have projections of its exponential growth. On the other is the hope that seasonality will help stem the tide. In the face of a potential pandemic, the health of the economy seems like a trivial concern. Still, this panic is having a material affect on economic activity and thereby markets. The Fed has tried to address this with lower rates, but even the Fed admits monetary policy can't do much to stop a virus. Where monetary policy will fail, hopefully modern medicine will succeed. Everyone, stay safe out there!
Succinct Summary: The story has been the same for most of this year. Consumer spending and sentiment remains strong while business investment and sentiment stay weak. There may be signs of an industrial uptick in China though.