Good afternoon. Investors want to know, “How can US Economy be tanking while equities have rallied more than 20% off their March 23rd lows.” The Answer: Super aggressive action(s) taken by the Fed, which stepped in to buy an unprecedented volume and range of assets. Without those actions, we would be facing an even bigger economic catastrophe. However, the Fed can only do so much to stabilize stock market especially when you consider 2nd quarter GDP looks to collapse 30 – 40% quarter-over-quarter and government data showing 26 million Americans filing for unemployment. So is this a bear market rally or does it have legs to go higher? Answer: With 1 in 6 Americans now unemployed and the Fed likely running out of “magic bullets” we would not be chasing this market. Yes, people are excited about our US economy reopening but stock valuations already reflect big P/E ratios (+20x) so does not make for good risk/reward scenario.
CHADWICK K. LANDRY
909 POYDRAS STREET – SUITE 2620
NEW ORLEANS, LA 70112
O: 504.702.8523 – M: 504.508.8900