Vanguard: Expectations for recession: Sharp but hopefully short

[Midpack]

Not that anyone really knows yet, but FWIW. I’ll be very surprised if it’s a short recovery, too much damage will be done before anything resembling “normal,” but I’ve been wrong before.

https://investornews.vanguard/expec...APRESPVOLCONTEM:EDU:MTOP:OTH:XXX:VGC:POS01:XX

 

[pb4uski]

Not much there, but what little that there was aligns with what I'm expecting to happen.

My big concern is the impact of this recession on consumer confidence. Though the other side of that coin is that it may rattle people enough that the savings rate will increase.

 

[OldShooter]

... it may rattle people enough that the savings rate will increase.

That would be my guess.

 

[foxfirev5]

That would be my guess.

That would be my hope, but I doubt it.

 

[USGrant1962]

An analysis I saw a couple of days ago suggested a V recovery because this is a service-economy-led recession. It argued that it is much faster to put servers, cooks, hair stylists, fitness instructors back to work than it is to start up industrial production like factories. Services are demand driven and the demand for haircuts is likely to snap back much faster than for capital goods.

 

[NW-Bound]

It's too hard to debate how fast we are going to climb out of the hole, while we are just barely starting to slide into the abyss.

I am more interested in how to stop the descent first. And it looks like only a lockdown can stop the virus spread.

 

[Montecfo]

Average recession is 1.3 years. This should end more quickly than that given its source: lockdown-induced coma. Also, when you have 3 million first time jobless claims, they are all hitting at once. That also suggests it will run its course quickly.

 

[flyingaway]

We have to stop the virus first before we can talk about the recovery. I don't see any way to stop the virus at this time other than the theory of "herd immunity". If that is the case, we have to hope that we are the one who survives after the infection, before we see the recovery.

 

[Freedom56]

What these so called investment experts don't understand is that like the purge from the last great recession, many will not find jobs again from the current purge. I know many people now in their 60's that were let go from professional positions back in 2009 that still have not found work. Businesses don't snap a figure and hire back people that they let go. During the re-hiring phase, they are much more selective and gradually hire back workers as business starts ramping up. We will see a recovery with all the stimulus from where we are now and headed over the next two months, but after the stimulus wears off, the markets aren't going anywhere until there is either a vaccine or a viable treatment for this virus.

 

[foxfirev5]

We have to stop the virus first before we can talk about the recovery. I don't see any way to stop the virus at this time other than the theory of "herd immunity". If that is the case, we have to hope that we are the one who survives after the infection, before we see the recovery.

Yeah much more accurate than mass producing ventilators for a fixed number of healthcare professionals to effectively use them.

 

[NW-Bound]

We have to stop the virus first before we can talk about the recovery. I don't see any way to stop the virus at this time other than the theory of "herd immunity". If that is the case, we have to hope that we are the one who survives after the infection, before we see the recovery.

To stop the virus, China looks to be successful with their lockdown. They are reopening Wuhan, and restarting factories.

European countries one after another are instituting lockdown.

The rest of the world is also doing it.

 

[audreyh1]

Not much there, but what little that there was aligns with what I'm expecting to happen.

My big concern is the impact of this recession on consumer confidence. Though the other side of that coin is that it may rattle people enough that the savings rate will increase.

Well the savings rate increased big time for a while after 2008-2009.

 

[Ready]

Some industries may never recover. Cruise ships come to mind.

 

[audreyh1]

It's too hard to debate how fast we are going to climb out of the hole, while we are just barely starting to slide into the abyss.

I am more interested in how to stop the descent first. And it looks like only a lockdown can stop the virus spread.

We have to stop the virus first before we can talk about the recovery. I don't see any way to stop the virus at this time other than the theory of "herd immunity". If that is the case, we have to hope that we are the one who survives after the infection, before we see the recovery.

We can start letting people out of their homes and go work or help others when we know they are either uninfected, or have been infected and recovered. Otherwise we keep repeating the situation and making more uninfected sick.

 

[travelover]

Some industries may never recover. Cruise ships come to mind.

Yea, what will we do with out those floating petri dishes?

 

[audreyh1]

To stop the virus, China looks to be successful with their lockdown. They are reopening Wuhan, and restarting factories.

European countries one after another are instituting lockdown.

The rest of the world is also doing it.

They didn’t just lock down. They also tested very aggressively and did extensive contact tracing and quarantining on people outside of Wuhan and as they started having people get back to work.

 

[pb4uski]

To stop the virus, China looks to be successful with their lockdown. They are reopening Wuhan, and restarting factories. ...

Let's hope that the reopenings don't result in another round of infectious spread.

 

[pb4uski]

Well the savings rate increased big time for a while after 2008-2009.

Yes, I remember that it did... unfortunately it didn't stick.

 

[Helen]

To stop the virus, China looks to be successful with their lockdown. They are reopening Wuhan, and restarting factories.

uh, oh...

Beijing's Film Bureau abruptly ordered theaters to close on Friday without explanation, according to multiple outlets including The Hollywood Reporter, Variety, and Deadline. It suggests concern about a second wave of coronavirus cases. Along with the theaters that had already reopened, Shanghai had previously announced on Thursday that it would reopen 205 of its theaters this weekend.

https://www.businessinsider.com/coronavirus-china-orders-all-movie-theaters-to-close-again-2020-3

 

[copyright1997reloaded]

They didn’t just lock down. They also tested very aggressively and did extensive contact tracing and quarantining on people outside of Wuhan and as they started having people get back to work.

We've now tested more than any other country. As of today, 626K tests have been done in the USA.
source: https://covidtracking.com/data/
15.9% of tests have been positive.

Other countries (as of 3/20): https://ourworldindata.org/covid-testing

China is reducing their new cases issue by .... not testing?

 

[PatrickA5]

As others have said, we have to stop the virus before the economy picks up. I don't think we will until we get really serious about it - like China did. Will Americans put up with police forcing them back into their homes? I doubt it.

 

[Midpack]

We've now tested more than any other country. As of today, 626K tests have been done in the USA.
source: https://covidtracking.com/data/
15.9% of tests have been positive.

Other countries (as of 3/20): https://ourworldindata.org/covid-testing

China is reducing their new cases issue by .... not testing?

Much improved, but testing per capita would be the correct metric for comparisons, and we have matched SK there yet. And strategic testing is crucial, not just absolute numbers.

 

[Midpack]

As others have said, we have to stop the virus before the economy picks up. I don't think we will until we get really serious about it - like China did. Will Americans put up with police forcing them back into their homes? I doubt it.

Compliance will improve if (when?) the infected/death numbers get totally out of control.

 

[audreyh1]

Let's hope that the reopenings don't result in another round of infectious spread.

That’s the difficulty - they have to keep testing workers, quarantining those who test positive and their contacts.

 

[audreyh1]

We've now tested more than any other country. As of today, 626K tests have been done in the USA.
source: https://covidtracking.com/data/
15.9% of tests have been positive.

Other countries (as of 3/20): https://ourworldindata.org/covid-testing

China is reducing their new cases issue by .... not testing?

I didn’t see China in that graph.

Outside of Wuhan they used a different approach - contact tracing and testing and quarantining. They were perhaps early enough and aggressive enough to contain it outside of Wuhan/Hubei with less testing than the US will now require, but I didn’t see the numbers.