The future was looking bright. Many of us were wearing shades.
That is, until the COVID-19 crisis came rolling in like a freight train.
The longest bull market in history was fun while it lasted. But now we’re faced with a completely new reality. Coronavirus literally rocked our world, and it continues to rattle and shake the U.S. economy to its core.
In today’s new normal, the market’s more volatile than ever. And the unemployment rate is soaring to record heights. In April alone, the Labor Department reported that 20.5 million people lost their jobs. And according to many analysts, it could take years to recover.
So how long will this last? No one knows, and even the experts disagree. To help put it in perspective, let’s compare where we are today to the Great Depression and Great Recession. The following table sheds light on unemployment numbers, GDP, the stock market and how long it took to recover.1
|Great Depression||Great Recession||COVID-19 crisis|
|Unemployment||24.9%||10%||Real unemployment is 22.8% and expected to continue to rise1|
|GDP||13% decrease||4.3% decrease||4.8% decrease and expected to drop up to 30% or more2|
|Stock market||84% loss (S&P)3||51% (S&P)3||34% (S&P)|
|How long did it take for a full recovery?||4.5 years4||4.4 years4||?|
If anything, the numbers underscore just how different our current situation is. The question is, what can you do now to help you navigate what’s ahead? It’s better to have a plan than to have no plan at all, so talk to one of our licensed financial professionals today. Request a complimentary strategy session. We’re here to help you power through these unprecedented times.
1Long, Heather and Van Dam, Andrew (2020, May 8). U.S. unemployment rate soars to 14.7 percent, the worst since the Depression era. The Washington Post. Retrieved from https://www.washingtonpost.com/business/2020/05/08/april-2020-jobs-report/
2Hansen, Sarah (2020, March 24) The Great Depression Vs. Coronavirus Recession: 3 Metrics That Will Determine How Much Worse It Can Get. Forbes. Retrieved from https://www.forbes.com/sites/sarahhansen/2020/03/24/the-great-depression-vs-coronavirus-recession-3-metrics-that-will-determine-how-much-worse-it-can-get/#1b89834815bd
3Backman, Maurie (2020, March 17), Bear Market Recovery: How Long Are We in For? Motley Fool. Retrieved from https://www.fool.com/retirement/2020/03/17/bear-market-recovery-how-long-are-we-in-for.aspx
4Hulbert, Mark (2009, April 25). 25 Years to Bounce Back? Try 4 ½. Retrieved from https://www.nytimes.com/2009/04/26/your-money/stocks-and-bonds/26stra.html