I’m comparing the words of three savvy economists with the stock market’s optimism, which seems fueled by hope for a quick treatment and vaccine.
In a May 22 interview on WealthTrack, Rob Arnott gave a dour view: “We will see more bankruptcies than we’ve seen since the Great Depression. … We’re not in a recession. We’re in a depression and …. I think it’s going to be three to four years before we’re back to the per capita GDP levels that we had just a few weeks ago.”
In a May 15 interview on WealthTrack, Ed Hyman was more upbeat: “…. there probably will be many, many bankruptcies and more layoffs…. But, there will be an end to this. … there’s a chance we will get a therapeutic and there’s a good chance we get a vaccine. … (maybe) the end of this year as opposed to the end of next year.”
In a May 24 article about “The Great Reopening,” Jeff Miller wrote: “There will be a rebound in cases over the next month. … the overall (health) impact could be significant. … the economic effects will be substantial. We have missed the chance for a ‘U-shaped’ (economic) recovery. Expect a (stock market) rebound followed by another decline – a ‘W.'”
The New York Times has an interactive tracker (below) that shows the daily number of cases and deaths by state and county. Alabama didn’t follow the guidelines for “flattening the curve,” so our numbers are going up.
Our economic recovery depends on mitigating the spread of the virus, which requires science-based public policy and the will and discipline of the public to mask and maintain distancing for as long as it takes.