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Data from World Population Review, World O Meter, World Health Organization and UNICEF.<\/p>\n
One Year US Index Returns Following Negative Events<\/strong><\/p>\n The Virus vs. Reaction to the Virus<\/strong> \u201cThe Chinese use two brush strokes to write the word ‘crisis.’ One brush stroke stands for danger: the other for opportunity. In a crisis, be aware of the danger\u2014but recognize the opportunity.\u201d John F. Kennedy Over the past week, global stock markets experienced the most severe 5\u2010day market correction in history. As news of the […]<\/p>\n","protected":false},"author":28,"featured_media":1325,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_oasis_is_in_workflow":0,"_oasis_original":0,"_oasis_task_priority":"","_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[14],"tags":[],"class_list":["post-1321","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy"],"yoast_head":"\n![\"\"](\"https:\/\/advisor.wellington-altus.ca\/stuchberry\/wp-content\/uploads\/sites\/121\/2020\/03\/Capture-1-300x201.png\")
\nOne Year US Index Returns Following Past Epidemics<\/strong><\/p>\n![\"\"](\"https:\/\/advisor.wellington-altus.ca\/stuchberry\/wp-content\/uploads\/sites\/121\/2020\/03\/Capture-2-300x92.png\")
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\nTrying to predict the emotional reaction to global events is very difficult, in the short term, it is all about psychology and how we make decisions. Advances in neuroscience now suggest that over 99% of our decision making is controlled by our subconscious narratives and emotion. Our two prime emotions of fear and greed continually cloud our conscious decision making. The 24\u2010hour news cycle keeps a steady stream of negative highlights affecting our short\u2010term emotional interpretation of the unfolding events.
\nDisasters have a tendency of not happening. To be clear, for many in Wall Street, history is what happened 15 minutes ago. To wit, investors should realize that the newsletter writing industry is based on the end of the world being just around the corner. To be clear, investors should expect a 10% correction every year, and when it happens, those pundits will be rolled out in the media. This time is no different. In a secular bull market, we should expect significant and intense pullbacks. Once the Covid\u201019 virus is brought under control, the global economy will continue to expand. This is not the beginning of a new secular bear market.
\nThe term \u201ckeep calm and carry on\u201d were the words of Sir Arthur Newsholme, Britain\u2019s chief medical officer, used to calm citizens during the Spanish Flu pandemic in 1918, which killed tens of millions of people. How did the stock market do in that crisis? It went sideways. Is that event in history a perfect analogy? No. But we investors should heed the tagline that got so many through that serious global event. As we become more informed, as policymakers implement best practices to contain Covid\u201019, the stock market should slowly recover. In the short term, the stock market is a voting machine reflecting short\u2010term emotions and bias. In the long term, the stock market is a weighting machine influenced by the fundamentals of the global economy. President Kennedy\u2019s words may very well be prophetic and coupled with the words of Sir Arthur, suggest that investors should \u201ckeep calm and carry on\u201d and take advantage of the opportunities the current crisis will present us. Working with an investment advisor to review individual plans and investment goals in the context of the current market environment can support
\ninvestors in doing so.<\/p>\n","protected":false},"excerpt":{"rendered":"