There’s been plenty of misery over the last few weeks.
The global economy closed up shop. Businesses closed their doors. Schools ended their years early. Retailers boarded up, or went out of business. Millions of people lost their jobs. In fact, according to the latest ADP report, the U.S. lost another 2.76 million workers in May 2020 thanks to the coronavirus.
That was well below the estimated loss of 8.75 million.
Still, the loss “is obviously an awful number, but not as catastrophic as expected,” says Mark Zandi, chief economist at Moody’s Analytics. Plus, with economies reopening, and people trying to get back to life as it was, the worst may have been priced in.
“The good news is I think the recession is over, the Covid-19 recession is over, barring another second wave, a major second wave, or real serious policy errors,” said Zandi, as quoted by CNBC. The bad news, he added, is that “the recovery will be a slog until there’s a vaccine or therapy that’s distributed and adopted widely.”
The other good news is that the pace of layoffs appears to have slowed considerably, and more people are heading back to work. From here, we could potentially see job growth pick up lost momentum in June and July.
Even Bank of America CEO Brian Moynihan apparently sees light at the end of the tunnel.
“We’re starting to see the economy come out of the hole,” he told CNBC. “The unemployment numbers are very high and very concerning. But on the other hand, if spending picks up, that will drive the economy back to where these people get their jobs back.”
“If consumer spending picks up and the demand for services, especially in the service side of the economy, picks up and how fast we can cross that river to where there’s enough spending to re-employ the people,” he added.
Given time, both the economy and markets could return to pre-coronavirus highs.
The post The COVID-19 Recession May Finally be Over appeared first on Morningology.
