Despite the media’s fear mongering, the simple truth is this: the economy is on the mend.
Indeed, though there may be dips and turns, it’s fair to say that the dark days of March and April–from an economic perspective–are behind us. It’s time to look forward.
The good news is pouring in:
The Homebuilders Index indicates a positive read as builders welcome low mortgage rates, jobless claims have declined for two straight weeks, the ISM index found that indicates an expansion in factory activity, and retails sales are currently back to pre-pandemic levels! Consumer spending, meanwhile, on big-ticket items like homes and cars, increased in the month of June while nearly 5 million jobs were added in the same month. Though the on-again, off-again nature of the shutdowns may still prove challenging for employment levels, there is increasing evidence that a vaccine will soon be available which will fuel a rebound improvement in consumer confidence in the coming months. https://www.wsj.com/articles/if-oxfords-covid-19-vaccine-succeeds-layers-of-private-investors-could-profit-11596373722
Overseas in Europe, a region hit harder on a per capita basis by the coronavirus, there are also signs of strength. In Germany, the European continent’s largest economy, surveys have found evidence of increased confidence coupled with an expansion in factory production. Sentiment among German companies has improved for the third straight time, with companies more satisfied and optimistic about their current business situation. https://www.ifo.de/en/node/57061 Given that European experienced the devastating effects of coronavirus roughly a 4-6 weeks ahead of the U.S., it’s worth noting signs of region’s economic progress as a precursor to U.S. improvement.
As the U.S. embarks on its own recovery, it’s clear we are unlikely to (at least in the near term) immediately return to the heady growth days of late 2019 and early 2020. Things will be different, of course, and certain industries and regions will suffer more than others but, overall, it is safe to assume we will find our way through these challenging times. If there’s one thing history has proven…it is to never underestimate the resilience of the American population. When businesses began reopening in the NorthEast, I was struck by the ability for small shops, restaurants and local communities to become creative… whether it meant cutting hair on the side walk at the local barber shop, moving restaurants into parking lots, or shutting down main street so businesses could sell their wares in newly created outdoor markets.
This is what America is known for–and this creativity and determination will help see the country’s economy through these challenging times.