Watch our webinar 'Global Capital Markets and the Economic Outlook with Todd Buchholz' on-demand below.
In this webinar Todd G. Buchholz, renowned economist and former White House Director of Economic Policy, discusses the outlook for the global economy and capital markets with Ocorian's Regional Head of Americas and Global Capital Markets Service Line Leader James Maitland and Sonal Patel, Managing Director, Head of Sales - Americas.
While acknowledging that, in light of the ongoing coronavirus uncertainty, nobody knows how global markets are going to play out, Buchholz argues that what he calls 'The Great Cessation' can end with a V-shaped recovery in the US.
"It wasn't detonated by excess speculation, it wasn't created by a trade war or normal tightening by central banks," he said. "This was a medical disaster – a cessation that was implemented by governments and private sector individuals deciding to make themselves safe. As restrictions are lifted, I do think consumers will have the wherewithal to claw their way back and we will have a relatively normal economy again, in roughly nine months time."
Still, Buchholz freely acknowledges that there is a much greater degree of optimism in the US compared with more downbeat assessments in Asia, Europe and the UK.
US confidence is clearly helped by huge liquidity flows from the Federal Reserve into the system. As Buchholz points out: "If Jerome Powell [Federal Reserve Chair], wasn't this aggressive we wouldn't be talking about a V-shaped recovery, we'd be talking about a lingering recession with no end in sight. It's important to recognise the old Wall Street saying: 'Don't fight the Fed'."
Global Capital Markets and the Economic Outlook with Todd Buchholz
Originally published 20 June, 2020
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