August 17, 2020

Weekly Market Commentary

August 17, 2020


The Markets

The Standard & Poor’s (S&P) 500 Index finished the week within a whisker of its February high, reported Randall Forsyth of Barron’s.

It’s been a historic feat. The stock market has recovered in just 175 days. Historically, comparable recoveries (those following market drops of 20 percent or more) have taken about four years.

The recovery is also remarkable because it occurred in the midst of a recession (that some have labeled a depression) and during a period of extraordinarily weak corporate earnings. Its possible investors are focusing on the fact that economic and earnings data has been ‘better-than-expected.’ For instance:

  • The U.S. economy shrank by -32.9 percent during the second quarter. While that was better than the -34.7 percent forecast, the U.S. economy still lost about one-third of its value.
  • The blended earnings of companies in the S&P 500 Index were -33.8 percent during the second quarter, as of August 7, which is the latest FactSet Insight report available. While most companies have performed better than anticipated, their profits had fallen significantly.


Life: Pandemic Style

The pandemic has changed the ways people all over the world think and interact with one another. It has also inspired artists and designers to find solutions to pressing problems, such as the need for social distancing. Here are a few inventions that may help us cope with pandemic life and help us find a new normal:

  • Glass lamps to dispel loneliness. Imagine you turn on a light in your home and it turns on a light in your parent’s home or your grandparent’s nursing home to let them know you’re thinking about them. Video artist Alexander Lervik’s website describes his invention like this:

“…a set of glass lamps shaped as rocks, which have been given the capacity of apprehending human touch and communicating with other rocks to express community and closeness. Perhaps you own one rock, and an older relative owns another so that they can sense when you touch your stone, thinking of them. The work offers a chance to think about all those old people who are lonely and in need of human touch.”

  • Devices to deliver anxiety-free dining. In the Netherlands, a restaurant has installed glass cabins on its patio that can accommodate two or three diners. Reuters reported, “Waiters wear gloves and transparent face shields, and use a longboard to bring dishes into the glass cabins to ensure minimal physical contact with customers.”

Travel and Leisure reported some restaurants may make indoor dining more palatable by installing plexiglass cylinders that hang from the ceiling like lampshades. Diners settle inside the cylinders as they are seated.

  • Hands-free door handles in grocery stores. To overcome pervasive reluctance to touch doorknobs and door handles in public places, a Finnish supermarket installed curved handles that allow shoppers to pull open cooler doors with their forearms, reported the World Economic Forum.


Focus On The Positive

“There will come a time when you believe everything is finished. That will be the beginning.”

–Louis L’Amour, Novelist


Best regards,

Bill Spalding