The U.S. economy is reopening across many states: While after the sharp snapback rally, a 5 or 10% market correction in June or July remains a distinct possibility, we believe that monetary and fiscal support have taken many “worst case” scenarios off the table. Last week we mentioned data from Read more
Part of the emerging narrative about the long-term economic effects of the COVID-19 pandemic and the business closures ordered in response to it suggests that it will lead to the ascendancy of the Big. The reasoning goes that big companies will be able to survive the downturn and will eat Read more
The COVID crisis is first and foremost a healthcare crisis, although it is having deep economic effects. Predictably, in the market volatility caused by the pandemic, the healthcare sector has broadly outperformed; and within healthcare, biotechnology has performed even more strongly. Of course healthcare is a broad sector, comprising many Read more
Parts of the United States and the rest of the world are tentatively moving towards re-opening their economies. Many unknowns remain about the path forward, including the timeline for developing treatments and producing vaccines, as well as many other issues. Those unknowns collectively are making it impossible for many companies Read more
If you’re in lockdown, working from home, or otherwise practicing social distancing, we hope this letter at least offers the chance to think with us about the implications of current events for the economic, financial, and investing landscape. Perhaps it will even be able to briefly take your mind away Read more
Note: Current events are very fast-moving. The following note was composed last week and sent to our clients and paid subscribers last Thursday. Our first thoughts for our clients, friends, and readers are for your health and resilience, both physical and psychological, as the current crisis unfolds. We trust and Read more
Coronavirus panic and a huge shock to oil markets converged on Monday to hand U.S. investors their worst day since the Great Financial Crisis. There were a lot of market-related movements that registered in the stratosphere of the unexpected: the size of the market’s decline; the rapidity of moves in Read more
Global stock markets reacted to the ongoing COVID-19 scare with unusual volatility last week, with U.S. stocks shedding about $4 trillion in value over six bruising sessions. The decline marked the fastest 10% correction from the peak in S&P 500 history (during 1987, the peak was in August, months before Read more
U.S. and Global Stocks We don’t believe that last week’s declines represented a rational response to neutral analysis of the risks posed by COVID-19. The data we have so far lead us to believe that those risks are relatively modest — that COVID-19 will not be a global black swan, Read more
Although the news is focused on the human drama of COVID-19 — with quarantines, heroism, tragedy, and fear — economists and financial analysts are busy working through different scenarios for the impact that the epidemic will have on economic activity and economic growth, both in the most affected countries and Read more
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