As quickly as the market fell late last quarter, it rose almost as rapidly this quarter. We had mentioned in the last Capital Market Update that “Generally, with little data to work with, the market prices in extreme scenarios. We will see if this is the case this time.”
Indeed, it appears that is exactly what happened. The S&P 500 for the quarter rose over 20% and at the close of the 2nd quarter the price change of the S&P stood at –4.04%.
As we progress, we have a lot of issues to sort out in the market. When everyone gets this newsletter we will be in the midst of earnings season and it seems to us that in regards to what companies will actually earn moving forward, will be anybody’s guess. That is what makes this earnings season so important. It will highlight what company’s business models have the wherewithal to function in a rapidly changing economy.