Are We Seeing Signs of Improvement in the Coronavirus Crisis?

March 31, 2020

In the past couple of days, I have gotten several questions regarding my assertion that there were signs that the spread of the virus has been stabilizing and even showing signs of improving. With headlines shouting about the rising number of cases and a health system under threat, the real question is, how can I make that statement?

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Monday Update: New Jobless Claims Hit All-Time High, Consumer Confidence Crashes

March 30, 2020

Last week’s economic updates were mixed. Some reports focusing solely on February showed a steadily growing economy, while more recent updates reflected the negative effect of the government measures taken during March to combat the spread of the coronavirus. This week will give us a chance to see just how concerned consumers and businesses are, based on the confidence updates set to be released for these sectors. We’ll get multiple looks at the current employment situation, with Thursday’s release of the weekly initial unemployment claims and Friday’s release of the March employment report.

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Coronavirus Update: March 27, 2020 [Video]

March 27, 2020

Today, I'd like to provide an update on the coronavirus crisis, including how it has affected the economy and financial markets thus far. While case counts have gone up, the growth rate (a better indicator) has started to trend down in the U.S. Unfortunately, the economic damage has just started to appear, as evidenced by the three million new unemployment claims last week. The government has stepped in with a $2 trillion stimulus package, a move that led the markets to stabilize.

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First Wave of Economic Damage: 3 Million New Unemployment Claims

March 26, 2020

As expected, the initial jobless claims report—the one that shows how many people have been laid off and are newly applying for unemployment assistance—was a shocker this morning. Three million people lost their jobs and applied for unemployment last week. This is by far the highest number ever, with the previous record at just under 700,000 in 1982.

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Congress Steps Up for the Economy

March 25, 2020

The Fed stepped up early and hard for the coronavirus crisis. It cut interest rates essentially to zero. It eased restrictions on banks to enable faster and more business lending. Plus, the Fed has taken unlimited measures to support the financial system as a whole, restarting programs from the last crisis to purchase bonds and inject money into the system. Unlike 2008, the Fed has been consistently ahead of the crisis, determined to choke any instability as quickly as possible before the medical crisis transmutes into a financial one. It largely looks like the Fed has been successful. The Fed and monetary policy have done what they can do so far, and they are poised to do more as needed.

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Coronavirus Update: U.S. Infection Growth Rate Holding Steady

March 24, 2020

Most of today’s headlines center around the rapidly growing number of coronavirus cases here in the U.S., with some comment on the fact that the number of cases in Italy also continues to grow rapidly. Occasionally, we also get a note that case growth in China has largely stopped.

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Monday Update: Retail Sales Fall Sharply in February

March 23, 2020

Last week’s updates, which touched on a broad cross section of the economy, mostly showed solid, fundamental improvements during February. That noted, the surprise rate cut by the Fed and a sharp drop in retail sales highlight the effect that the coronavirus will likely have on future reports. This week will be another busy one, with important reports on business and consumer confidence expected to draw the most attention.

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The Coronavirus Pandemic and the Financial Markets

March 20, 2020

We have spent the past couple of days first looking at the coronavirus pandemic itself and then at the likely economic effects. Which brings us to the third part of our discussion: market reactions. Now, we have the context to look at what has happened and think meaningfully about what might happen next.

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Coronavirus Update: March 19, 2020 [Video]

March 19, 2020

Today, I'd like to share my framework for thinking about the coronavirus crisis, focusing on the virus itself, its economic effects, and the market implications. Viewed through this lens, it seems the virus is controllable, as seen in China and South Korea. Further, the widespread panic has been a positive, enabling governments to put effective restrictions in place.

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Assessing the Economic Damage from the Coronavirus Pandemic

March 19, 2020

Yesterday, we talked about how the coronavirus pandemic itself can be brought under control, and how in many countries it already has been. Here in the U.S., we are not there yet, but we can reasonably expect to get there in the next month or so. That is the good news.

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Appearance on Fox Business Network’s The Claman Countdown, March 18, 2020 [Video]

March 19, 2020

What should investors do given the market turbulence created by coronavirus fears? Yesterday, I appeared on Fox Business Network's The Claman Countdown to discuss this and more.

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The Coronavirus Pandemic: A Solvable Problem?

March 18, 2020

Yesterday, we talked about the big picture around the coronavirus crisis: the pandemic itself, the likely economic effects, and, last but certainly not least, the market reactions. Next, I want to start a more detailed discussion of each component. We will deal with the pandemic today, the economy tomorrow, and the markets on Friday. Although the big picture provides valuable context, there is also quite a bit to be gained by diving deeper into each component.

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How to Think About the Coronavirus Pandemic: The Big Picture

March 17, 2020

With everything that is happening in the world, now is a good time to step back and think about where we are and where we might be going. There is a tremendous amount of information available. But what’s missing is a framework for that information that would help clarify the big picture.

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Appearance on Yahoo Finance's On the Move, March 16, 2020 [Video]

March 16, 2020

What do I make of the Fed’s surprise rate cut over the weekend? I discussed this and more today on Yahoo Finance’s On The Move.

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Monday Update: Consumer Confidence Drop Smaller Than Expected

March 16, 2020

Last week was relatively quiet on the economic update front. On an encouraging note, the preliminary consumer confidence report released for March showed a slightly smaller-than-expected drop in sentiment. This week will be busy, with many of the scheduled releases expected to show continued economic growth in February. Going forward, however, we expect to see headwinds due to the escalating nature of the coronavirus pandemic.

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Appearance on CNBC’s Power Lunch, March 13, 2020 [Video]

March 16, 2020

On Friday, I appeared on CNBC’s Power Lunch to discuss the coronavirus, fear, and the market. Listen in to hear more.

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Monthly Market Risk Update: March 2020

March 13, 2020

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Market Risk Update. Thanks for the assist, Sam!

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Appearance on Yahoo Finance's The Final Round, March 12, 2020 [Video]

March 13, 2020

Yesterday, I appeared on Yahoo Finance’s The Final Round to discuss recent market declines, including what to expect going forward. Listen in to hear more.

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Where Bear? There Bear!

March 12, 2020

My son has a stuffed bear he got when he was quite small (from Commonwealth, as it happens). We used to play a game where the bear would sneak up on him. “Where bear? There bear!” Well, the bear is now here. We have finally seen the end of the bull market, with the Dow dropping 20 percent from its highs and the S&P 500 following today. We are officially in a bear market, with all that implies. Stock markets around the world are down again today on the news.

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Economic Risk Factor Update: March 2020

March 11, 2020

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Economic Risk Factor Update. Thanks for the assist, Sam!

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The 2020 Stock Market Crash

March 10, 2020

In early March, we saw markets drop worldwide. In fact, the 7.5 percent decline on March 9—which, coincidentally, happens to be the 11th anniversary of the bull market—was the largest since 2008. With a total decline of almost 19 percent, in less than a month, this certainly looks like a crash—doesn’t it?

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Monday Update: Signs of Economic Improvement in February

March 9, 2020

Last week’s economic updates showed surprising economic strength in February, highlighted by improving business confidence and an unexpectedly strong February jobs report. In March, confidence figures are likely to decline, due to the global spread of the coronavirus. Nonetheless, before that crisis emerged, the recent updates pointed toward an improving economy poised for faster growth. This week will be relatively quiet on the economic update front. Economists will, however, be closely monitoring the preliminary consumer confidence report set to be released on Friday, which will be our first look at consumer confidence in March.

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View from the Aisle: Takeaways from the Inside ETFs Conference

March 6, 2020

In January, members of Commonwealth’s Investment Management and Research team traveled to Florida for the Inside ETFs conference, which has become the world’s largest conference on this topic. We met with and heard from industry experts and a number of ETF providers, and we networked with peers from other firms to discuss the latest trends within the ETF industry. Every year, a couple of topics seem to dominate the discussions. This year, without question, the two hottest topics were the emergence of nontransparent actively managed ETFs and the surge in environmental, social, and governance (ESG) investing.

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Is the End of the Bull Market Nigh?

March 5, 2020

Monday, March 9, will be the 11th anniversary of the bull market that started back in 2009. With recent pullbacks and turbulence around the coronavirus, it is reasonable to worry that this anniversary will be the last and that a bear market will break the streak sometime in the next year. As such, now seems a good time to consider where we stand—and where the market might be headed.

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The Rate Cut and the Market

March 4, 2020

I know I am coming a bit late to the party on this, as there has already been a great deal of commentary and reaction to yesterday’s unexpected move by the Fed to cut interest rates by half a percentage point. Markets dropped after the announcement, but we are now seeing a strong rally. Pundits are on all sides of the issue. So, what’s really going on?

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Monday Update (on Tuesday): Consumer Confidence Remains Resilient

March 3, 2020

Although investor attention has been focused on concerns about the coronavirus and the equity market sell-off, last week’s economic updates showed surprising strength. The highlights of this week’s data releases will be reports on business confidence, international trade, and jobs.

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Market Thoughts for March 2020 [Video]

March 2, 2020

February was a tough month. Both U.S. and international markets dropped sharply at month-end, as the coronavirus continued to spread across the globe. While the declines are worrisome, previous outbreaks, like Zika and SARS, have resulted in similar outcomes. As such, the markets’ response to the coronavirus can actually be considered normal.

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Upcoming Appearances

Tune into Yahoo Finance's The Final Round on Friday, June 5, at 3 P.M. ET (time subject to change) to hear Brad talk about the market. Watch at https://finance.yahoo.com/show/finalround/

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The information on this website is intended for informational/educational purposes only and should not be construed as investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. Please contact your financial professional for more information specific to your situation.

Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not indicative of future results. Diversification does not assure a profit or protect against loss in declining markets.

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