Reality, or the Raft?

March 23, 2020

Last week, The New York Times shared the story of a rafting group who returned from a month of isolation in the Grand Canyon to discover a new reality. 

I have tried to imagine what I might choose if offered a return to reality or another month in the raft. If the raft would be your choice, you could set sail knowing that I’ll keep an eye on things here.  If, however, you might wish to hear a little more before deciding, here’s a quick update.

Around the world, everyday lives have changed dramatically amid efforts to minimize the impact of the COVID-19 pandemic. These efforts are necessary, but they also have come at a cost. Global economic growth has been slowing, the US economy likely will contract temporarily, and US stocks have entered a bear market. Big stock market moves, both up and down, have become the norm.

However, the actions of global central banks and governments to support their economies and stock markets are encouraging. For long-term investors, it’s important to maintain a clear vision of financial goals and the plan for getting there. Current uncertainty means taking a careful, measured approach, but for appropriate investors there may even be small ways to consider taking advantage of these potential opportunities.

It’s likely we may see an economic rebound later this year and into 2021 as the outbreak is contained, businesses reopen, and fiscal and monetary policy support expands. The US economy and corporate America have steered their way through world wars and cold wars, financial crises, and geopolitical events. Through even the most challenging times, markets have found their way back to normalcy, and investors have been able to look to the future. There’s no reason to believe this time will be different.