Separating Market Correction from Recession
When the pandemic began, the stock market and the economy were thrown into turmoil. Five months later, many are wondering if the worst is over.
In this episode of Your Money, Leo Daprile of Gem Young Insurance and Financial Services in Canfield explains the difference between a market correction and a recession.
The textbook definition of a recession is a drop of 20% or more. In March, we saw a 37% decline. However, Daprile says that on average, a recession lasts around 18 months.
“Here we are, five months later, and we’ve already recovered,” Daprile says. He believes we went through a stock market correction as opposed to a recession.
“The S&P 500 has returned to an almost record high in a very short period of time,” Daprile says. “But we are still experiencing “pocket recessions” in industries that are really struggling.
The restaurant industry, for example, is not going to recover for a while. According to a report from Yelp, 60% of restaurants that have shut down during the pandemic are now closed permanently.
To learn more, watch the video above.
Original Air Date: August 18, 2020. Every Tuesday during the Dan Rivers show on AM570 WKBN, Gem Young’s President, Leo Daprile, hosts a radio show called Your Money. Daprile brings his vast knowledge of all things “money” to discuss the topics in language everyone can understand.
About Gem Young
We’re a family business that does business with individuals and families who require comprehensive risk management for their wealth and their assets. We believe clients want professional advice at a fair value and we deliver that by leveraging our reputation of professionalism, integrity, teamwork, and a get- it-done-right-the-first-time attitude. We believe in making a difference in our clients’ lives.
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