MINT HILL, NC – Want to play a game? Two truths and a lie…#1 – the current unemployment rate is 3.5%, which is the lowest since 1969, #2 – the US economy has now regained the 22 million jobs lost during the pandemic, #3 – always believe the news. The lie should stick out like a sore thumb.
Should we believe everything we are told? Record high inflation and negative economic growth, as measured by US GDP growth, have fueled recession fears. There is no historical precedent to indicate an economy in a recession can produce continued job growth and support a historically low unemployment rate. We will have to wait to hear from the officials at the National Bureau of Economic Research, who often take months to make the official call after the fact.
Just remember this, the stock market and the economy, while linked, are not one and the same. Stock markets look ahead, while the economy is a look in the rearview and tends to lag. The debate over whether or not we are in a recession and whether the latest rally is sustainable will surely continue. At Fulcrum, we don’t get distracted by fear or greed.
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This article was written by AssetMark for general public use by your local Cambridge Investment Research Financial Advisor.
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