Uncertainty Abounds in the Search for Economic Recovery Timetable

Thursday April 23rd, 2020 For Buyers, For Sellers, Housing Market Updates
Earlier this week, we discussed how most projections from financial institutions are calling for a quick V-shaped recovery from this economic downturn, and there’s research on previous post-pandemic recoveries to support that expectation.

In addition, we noted how there are some in the business community who believe we may instead be headed for a U-shaped recovery, where the return to previous levels of economic success won’t occur until the middle of next year. Yesterday, Reuters released a poll of U.S. and European economists which revealed that most surveyed are now leaning more toward a U-shaped recovery.

Here are the results of that poll:Uncertainty Abounds in the Search for Economic Recovery Timetable | Simplifying The Market

Why the disparity in thinking among different groups of economic experts?
The current situation makes it extremely difficult to project the future of the economy. Analysts normally look at economic data and compare it to previous slowdowns to create their projections. This situation, however, is anything but normal.

Today, analysts must incorporate data from three different sciences into their recovery equation:

1. Business Science – How has the economy rebounded from similar slowdowns in the past?

2. Health Science – When will COVID-19 be under control? Will there be another flareup of the virus this fall?

3. Social Science – After businesses are fully operational, how long will it take American consumers to return to normal consumption patterns? (Ex: going to the movies, attending a sporting event, or flying).

The challenge of accurately combining the three sciences into a single projection has created uncertainty, and it has led to a wide range of opinions on the timing of the recovery.

Bottom Line
Right now, the vast majority of economists and analysts believe a full recovery will take anywhere from 6-18 months. No one truly knows the exact timetable, but it will be coming.

2 Comments

  1. What Makes An Agent So Incredibly Nasty on March 1, 2021 at 6:30 pm

    […] Beliefs are what we tell ourselves about a given topic–rules or associations we have decided are true with absolute certainty. Beliefs are influenced by many factors including your parents, society and all other outside influences that you adopt. Beliefs are the key to success and failure. This is true for all areas of your life… Read More → […]

    • jruckman on March 13, 2021 at 3:26 am

      very true

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