No one could have foreseen or planned for the onslaught of a global pandemic and the human and economic toll it would extend. But as vaccines begin to reveal a light at the end of the COVID-19 tunnel, experts across disciplines are debating and preparing for what the future may hold.
In that spirit, Tony DeSpirito, CIO of U.S. Fundamental Equities, hosted a virtual sit-down with U.S. Economist William C. Dudley, former NY Fed President and vice chair of the Federal Open Market Committee, to discuss the outlook for the U.S. economy and stock market.
The conversation was far-reaching and can be viewed in full here. One of the key messages: Expect a recovery as unusual as the crisis itself.
One thing the two quickly agreed on: There is no historical analogy for what we’ve just experienced. They also suggest there is potential for the economy to come roaring back faster than many expect.
Monetary policy is on its “maximum stimulative setting,” with fiscal policy also on “full throttle.” A key question, according to Mr. Dudley, is how quickly unemployed Americans can get back to work:
“The goal, quite frankly, is to try to get the 9.5 million people that are still out of work back to work quickly because this pandemic has been very uneven in terms of its impact on people and households.”
If it happens fast, that is clearly good news. The flip side is that it also means the policy regime could turn much more abruptly than it did after the Global Financial Crisis (GFC) of 2008.