On the heels of global markets rebounding sharply in the month of April, there is a growing sentiment in the financial media that markets are not accurately reflecting the reality we are all living through.
As Covid continues to spread and alter our way of life, both the human and economic toll continues to mount. With concerns about possible second and third waves in the future as we re-open states and cities, there are growing references to the Spanish flu and Great Depression.
As more gets written about the disconnect between Wall Street and Main Street, and the markets and the economy, let’s try to remember that Wall Street and Main Street have always been disconnected, and for many reasons, never will be connected.
And just the same, as we have written many times before, the market is not the economy. They are separate but interrelated things. And for reasons we will outline below, really aren’t that distorted from reality at all, even though it may feel like it.