Market Looks like a Panic- 3/12/2020

March 12, 2020

stock market volatility

I thought yesterday looked like a classic “panic” market, moving down way ahead of information. Such are event driven bear markets. Even as we still have little information, the markets will try to digest this potential global scare. Such market reactions tend to be extreme, but shorter than declines due to economic forces. When I read something that says it well, I figure I can’t add much- such as I read on CNBC from Jim Paulsen at Leuthold Group:

“I don’t know where the bottom is here. I think we’re close to it, though. I really do. This thing just oozes panic to me and the movement, the ferociousness and speed by which stocks have fallen and, now, bond yields looks more like the end of a colossal panic than the beginning. So, I would start … to nip away at it on these kind of down days that we have. … No doubt the economy’s going to slow. We’re going to get bad economic data coming out. But the real question isn’t, is it going to be bad? The question is, is it going to be worse than feared? Because if it turns out that the economy isn’t collapsing as bad as we feared, that’s good news. So, we could have a bad news becoming good [scenario], I think, over the next few weeks…”

The team is all remote for now, but we are fully connected and reachable by email. We receive notice of our phone calls via email as well. My daughters are both home for the duration of their semester as I know many of your children are as well.

We will focus on markets and portfolios and we urge you to stay safe!