Market update, commentary and client questions from Tuesday, April 14, 2020 with Joe Anderson, CFP®, President of Pure Financial Advisors, and Pure’s Executive Vice President and Director of Research, Brian Perry, CFP®, CFA.
Download Brian Perry’s full slide presentation.
03:00 – Is the CARES Act Helping the Economy Yet?
03:40 – US GDP 2017-2020
04:05 – Record Initial Jobless Claims
05:20 – The Economy: The Good, The Bad & The Ugly
The Good: Lower oil prices, lower interest and mortgage rates, robust government support
The Bad: Millions out of work, small businesses struggle to reopen, how long until “normal”?
The Ugly: What does COVID-19 mean for globalization? How will industries evolve? What about jobs that don’t come back?
09:12 – Conference Board Economic Forecast, April 9, 2020
May Reboot (quick recovery)
Summertime V-Shape (deep contraction, v-shaped recovery)
Fall COVID-19 Resurgence (2nd contraction in Q4, W-shaped recovery)
Fall Recovery (extended contraction, U-shaped recovery)
11:47 -Technical Recessions By Country, 1960 – 2019: recessions are part of the economic cycle
13:25 – The Opportunity for GDP Growth
14:37 – Putting the Recent Market Rally in Perspective
Stocks Have recovered: S&P 500 in the past 10 years and in the past 3 months
16:10 – High-Yield Bond Market Stabilizes
17:29 – Affected Industries Earnings Contribution to 2019 S&P 500 Operating Earnings
Hotels and tourism, airlines and cruises, entertainment, restaurants and bars, retail ex-food and beverage
18:33 – A Look at Types of Bear Markets: Structural, Cyclical, and Event-Driven
Attendee Questions:
21:54 – I just received my CARES Act rebate, what is the impact of the rebate to my 2020 tax return? Is it additional income?
24:20 – Are markets traditionally good in election years? What do you think will happen this year?
25:42 – The national debt is likely to skyrocket with the CARES Act and other legislation to address the economic challenges due to COVID-19. What is long term impact of this on investors and US citizens at large?
28:02 – Do you know the schedule for the issue dates for stimulus checks? And do you know what the max income level is to receive the $1200 per person, versus what are the amounts that are to be paid out for income levels that are higher?
29:50 – It seems as though the recent stock market recovery assumes a V-shaped recovery which is a BIG assumption. Wanted to get your thoughts on this?
31:00 – Outro & thanks
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