Magnitude of recession 'like to be staggering'
He said: “It’s no coincidence that the rally of the past few weeks coincided with promising news about the number of new cases, first in China and then in parts of Europe. And over the past few days, the Centers for Disease Control and Prevention said the outbreak has stabilized across the United States and Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases in the U.S., said parts of the country may be ready to ease emergency measures in May.
“That’s all very encouraging and yet investors can’t be complacent. It’s still likely going to be months, not weeks, before economic activity in back to normal and even that is still in doubt if there is a second wave of the disease. Remember, China was reporting zero new domestic cases a couple of weeks ago, but just locked down Harbin for 28 days due to a growing number of imported cases.”
Nevertheless, he told investors and advisors not to ignore economic data but to be more discerning about it and not get caught up in the headlines. He stressed that this is also true as Canada whirls into earnings season, warning that’s the big picture might be worse than many off the reports suggest.
“A lot of the numbers that will be reported in the next few weeks won’t reflect the severity of the current situation because the impact of the pandemic only really started to take hold at the end of the first quarter,” he explained.