Large portions of the U.S. and global economy remain frozen in an effort to control the spread of the Coronavirus. So far, 26.45 million Americans (out of 162.9 million total workers) have filed for unemployment over the last four weeks. As we progress further into recession, the only questions are how deep will it go and how long will it last?
With the COVID-19 environment continually evolving, your Pacific Wealth Management team has created an online library of articles and videos worthy of sharing. We will continue updating this library as we come across new information to help keep you informed. As always, please feel free to contact us if we can be a resource for you.
Due to the deluge of recent news and legislative changes we would like to offer a summary of the most important developments of the past few months to ensure that you stay informed on issues that may be pertinent to your personal financial plan.
Last week the global financial markets experienced a “rush to cash” in a fear driven sell-off across nearly every asset class and sector. Over the last 5 weeks, stock markets have experienced their fastest descent from all-time highs to a bear market in history, surpassing even 1929. The February 19th stock market high will likely be recognized as the beginning of a recession that may be just as sudden and sharp.
The financial market volatility surrounding COVID-19 continues at historic levels. The harshness of the decline, combined with a collapse in oil prices, along with ongoing downward earnings revisions, suggest the bottoming process for the stock market will likely take some time. The significant human toll is unprecedented and certainly the primary driver of the fear continuing to grip the financial markets. As we mentioned in last week’s comment, we believe markets around the world will be enduring a prolonged, difficult period of both upside and downside volatility over the next few months.
The coronavirus (COVID-19) has been roiling the financial markets since late January when it arrived on the radar screens of investors around the world. Last week, the S&P 500 experienced its largest decline since the banking crisis of 2008-2009. On February 19th stocks were at record highs, by Friday the 28th, U.S. stocks were down more than 10% from those high levels and down 8.6% overall for 2020.