Is the US economy suddenly recovering?

[exstasie]

New ATH for Amazon, new ATH for the NASDAQ, and the S&P 500 is at the top of its range and threatening new highs.

Logically the stock markets and economy will eventually converge again. Either stocks will fall when the economic recovery disappoints the market, or the economic recovery will speed up to meet the market's expectations.

With stimulus programs wrapping up and Republicans low balling any further bills, these are a few neutral to bearish perspectives I think are worth keeping in mind:

Citi expects stocks to go sideways for a year, suggests defensives

"The bullish push from $6 trillion of global quantitative easing is likely to cancel out the bearish drag from the ongoing lockdown," the investment bank's equity strategists said in a note published late on Sunday.

"We would not chase markets higher from current levels," the strategists said.

Goldman Sachs thinks the US recovery is running into trouble

The surge in coronavirus cases across the Sun Belt is slowing the economic recovery in the United States.

That's according to Goldman Sachs, which said this weekend it now expects a weaker rebound in the third quarter as local leaders impose fresh restrictions and consumers show signs of caution. The investment bank predicts the US economy will grow at an annualized rate of 25% in the three months ending in September, as opposed to 33%.

Financial analyst Gary Shilling says the stock market could see a 1930s-like decline

In a CNBC interview, Shilling said the stock market could plunge between 30-40% over the next year as investors realize the economic recovery from the coronavirus recession could take longer than expected.

“I think we’ve got a second leg down and that’s very much reminiscent of what happened in the 1930s where people appreciate the depth of this recession and the disruption and how long it’s going to take to recover,” he said.

“Stocks are [behaving] very much like that rebound in 1929 where there is absolute conviction that the virus will be under control and that massive monetary and fiscal stimuli will reinvigorate the economy,” he said.

Shilling doesn't have the best track record with these kinds of calls, but I think his logic and read on sentiment is spot on this time. The problem is it's really hard to bet against the Fed and their QE infinity.

[mezzaluna]

The United States will be really able to recover after sometime because of the fact that people will always look for ways to recover. Some business are not always relying on the government because they know that they need to stand on their own for their businesses to prosper. Also, United States holds some of the biggest companies that can really withhold their economy like Amazon and other related e-commerce.

[fiulpro]

It was obvious that in the long run we would have seen the US economy recover, but honestly I wasn’t expecting US economy to recover so fast, or is this just another false positive for us?. I’m referring to the article posted by CNBC where they have shown stats which proves that the US economy has started recovering despite many states yet being in lockdown. What are your thoughts on this, will the US economy recover faster than what we had anticipated?.

Source:

https://www.cnbc.com/2020/06/28/here-are-five-charts-illustrating-the-us-economic-recovery-amid-the-coronavirus-pandemic.html

Why do you think that the cases are sky rocketing in the US ?

People did not listen to the restrictions which were put forth by the government and therefore most of the small businesses were open , in the small villages the life never even changed , at some places they don't care about the coronavirus now.

Most of the businesses were open , plus one's that were able to shift from office to home did have even a better outcome. Call centres , offices , schools , colleges everyone is working and was working from the day of quarantine. People who did loose customers and such , they had to find new ways to earn and therefore the economy recovered in a short while.

People changed according to the pandemic , which is natural and very important for the community as a whole for the survival. I remember the words of a famous botanist at this time : Change is the nature of nature. Even if the virus stays , we can easily evaluate that the life might be different , but it won't stop.

[Ozero]

It was obvious that in the long run we would have seen the US economy recover, but honestly I wasn’t expecting US economy to recover so fast, or is this just another false positive for us?. I’m referring to the article posted by CNBC where they have shown stats which proves that the US economy has started recovering despite many states yet being in lockdown. What are your thoughts on this, will the US economy recover faster than what we had anticipated?.

Source:

https://www.cnbc.com/2020/06/28/here-are-five-charts-illustrating-the-us-economic-recovery-amid-the-coronavirus-pandemic.html

I do not think that this is objective information. On the one hand, the situation is too embellished by the authorities, and on the other, a lot of dollars are printed. Now the United States has the largest number of coronavirus infected - more than 2 923 000 people. This country is now in first place for these sad statistics. Also, the unemployment rate has increased significantly, which means that the economy has fallen sharply.

[super bako]

it's all a natural thing for the US to recover quickly because of a country which is domiciled in developed countries. but if I compare it with China, it can be the most superior in accelerating economic recovery and so on.?
and between the two countries it is natural because their development is very fast and as a state of good authority in terms of elements, and other countries are channeled gradually following the stable new growth....?

[thesmallgod]

US is witnessing the second wave of the pandemic recently with over 50k cases recorded recently in a day which goes a long way to tell us the economy recovery will be very difficult. Currently the US government is having a serious argument with the education board that has makes it clear that student will not resume schools. US economy recovery policy is flexible but there is currently no certainty that the economy will recover rapidly

[exstasie]

Two scary headlines today regarding the economy:

WHO: Indoor airborne spread of coronavirus possible

That hints at a slower recovery since people will be more hesitant to frequent indoor businesses like restaurants, bars, theaters, gyms, etc. That is if local governments don't just start shutting those kind of businesses down again.

States with severe coronavirus outbreaks should ‘seriously look at shutting down,’ Dr. Fauci says

That's the last thing the markets want to hear. The S&P 500 dumped 2% on the news but recovered into the day's close. BTC followed, naturally.

It feels like investors mostly have blinders on, with everybody so strongly against shutting down again that they've just decided in their minds it's not going to happen. They may be in for a rude awakening if hospitalizations keep up at this rate. I wouldn't be surprised if California is the first to shut down again, like they were in March. That would trigger major dumps.

It feels like the market still wants to push higher, but the sentiment and underlying fundamentals are very dangerous. We could be heading into a judas swing type pattern, where the next upside breakout quickly reverses into a crash.

[FlightyPouch]

US is witnessing the second wave of the pandemic recently with over 50k cases recorded recently in a day

To be clear though, this is still not the 2nd wave they said it is still a part of the first wave. The first wave is still not flattened out and the reason for these new cases popping up is that the lockdowns are loosening up.

US economy recovery policy is flexible but there is currently no certainty that the economy will recover rapidly

As they said, the market is having good movements but that doesn't mean that the economy will be regaining that easily. This will really take years especially if we still experienced the 2nd wave which I hope we wouldn't.

[STT]

US economy to recover so fast

Thats a bounce not a recovery as such, has to be a trend of growth to really count as more then just a wave forward after being restricted and held back deliberately.   Its very common to regain some of a large move previous especially if it were in some way false or over done.   Its possible we see negative figures on the next or I'd expect some disappointment and quite lax retraction in future towards where GDP was previously.
   A recession is two quarters of negative growth and so we should at least wait 2 quarters to see how this will pan out but its good theres a large retake of jobs, etc.   I dont expect to judge it fully till we have a vaccine available to millions.

[Savemore]

There are a lot of people who are misunderstood the economy of US, yes they are recovering but it will take more years in order for them to recover all of the losses that they incurred. There are a lot of jobs that are been lost because of this pandemic and there are businesses that are now totally closed because they cannot cover their expenses anymore. For those who want to understand the U.S. market more, try to view the bigger picture where you consider the GDP, the Stock market and the business that are currently operating and also if they unemployment rate decrease.

[Heart18]

USA is a very rich country because of their unlimited resources.
I think, it would be easier for them to recover after all this Crisis, or maybe after they lift up all community quarantine...they will be back into place so fast and will always be the King of the world.

[inoes]

If there is a country that can recover quickly, then is not that something that is good and positive for other countries as well because with the recovery that occurs quickly, of course it will trigger other countries to make better efforts to restore the country's economy. There is nothing wrong if they can claim a speedy recovery, because in the end the truth will definitely be seen or not and I think the most important thing is that recovery will definitely happen with a process that will certainly not be easy.

i think so,  besides that it could indicate that America is indeed a Superpower. this is reasonable because American manufactured goods are the largest in the world, have world famous brands up to be the king of the world's currencies

[Chrystora123]

I don't really believe in the fast recovery of the US economy..  now almost all countries feel the impact of minus economic growth.  before the vaccine really exists, economic growth in almost all countries including the US will slow down..


source: https://www.bea.gov

[Ronaldcoin2017]

USA is a country that has so many resources and they can quickly recover if their economy will fall, i believe that USA is a great  country they are so advanced in terms of technology so i think ot is not questionable if they recover vey fast if there are crisis, i think we need to put basis on USA as a model for us to also easily recover if there are crisis.

[hunter7519]

Well, as we all know  US belongs to 1st world country . As expected even if their economic growth are effected by this pandemic they could easily recover. Compare to the 3rd world country it take years or the worst is decade to recover. But if every country helps one another maybe it will not take a years to recover.

[Negotiation]

The U.S. economy is recovering because the U.S. is developed in all aspects.  They are able to recover very easily even if their country's economy is damaged by being at the top of the list compared to other countries. The United States of America is the first source of everything in the technology business trade exchange in the world.  Each of their companies is far ahead in terms of crypto investment.

[Nhor1011]

The global economy was obviously going to recover pretty quickly after lockdowns were lifted and I think it'd still be doing quite well since california and San Francisco seemed to lockdown early and that's where a lot of the technological parts of the economy come into play afaict...

I think it's true that US economy are now going to recover quicky after lockdowns.Also we know how strong the economy of US that's why it was not a surprise if the economy has a fast recovery from the worst caused of pandemic.Covid pandemic won't  bring down the US economy.

[Vishnu.Reang]

US is witnessing the second wave of the pandemic recently with over 50k cases recorded recently in a day which goes a long way to tell us the economy recovery will be very difficult. Currently the US government is having a serious argument with the education board that has makes it clear that student will not resume schools. US economy recovery policy is flexible but there is currently no certainty that the economy will recover rapidly

If that is the case, then an economic recovery may take many years. During the last 4-5 days, the United States has reported anywhere between 60,000 to 70,000 cases per day. And remember that this count is even more than the highest daily count we had, even during the peak of the first wave (when states such as New York and New Jersey were affected in April-May).

[Juggy777]

US is witnessing the second wave of the pandemic recently with over 50k cases recorded recently in a day which goes a long way to tell us the economy recovery will be very difficult. Currently the US government is having a serious argument with the education board that has makes it clear that student will not resume schools. US economy recovery policy is flexible but there is currently no certainty that the economy will recover rapidly

If that is the case, then an economic recovery may take many years. During the last 4-5 days, the United States has reported anywhere between 60,000 to 70,000 cases per day. And remember that this count is even more than the highest daily count we had, even during the peak of the first wave (when states such as New York and New Jersey were affected in April-May).

@Vishnu.Reang yea the US economy is faltering again, and the recent surge in cases is the primary reason why the economy has started falling downwards again. Further the jobs sector which had gained in June has also gone down, and this is not a good sign for the US citizens. Lastly I’m not sure how will Trump be able to accelerate the economy by September, as he had claimed that by September US economy will be back on track.

Sources:

https://www.bloomberg.com/news/articles/2020-07-11/five-real-time-charts-show-signs-economic-recovery-is-faltering

https://www.politico.com/news/2020/06/06/trump-recovery-summer-304384

[super bako]

There are a lot of people who are misunderstood the economy of US, yes they are recovering but it will take more years in order for them to recover all of the losses that they incurred. There are a lot of jobs that are been lost because of this pandemic and there are businesses that are now totally closed because they cannot cover their expenses anymore. For those who want to understand the U.S. market more, try to view the bigger picture where you consider the GDP, the Stock market and the business that are currently operating and also if they unemployment rate decrease.

Indeed. but if the virus lasts a long time, it could mean a slow recovery of the state. and if it is handled incorrectly it might be quite bad. if it makes something structural that inhibits recovery. however, if the pandemic will be lifted in the next few months, it can be observed as a good thing. in the future, in my opinion what impact will that have?