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Notes from a Social Distance

| April 14, 2020
We are definitely on wild roller coaster ride at this point. We have gone from record highs to the worst first-quarter performance in market history, to the largest gains, to steep drops again. And it's not just the market; our emotions are on that same ride.
I keep hearing from folks worried that this time, our economy won't bounce back, that we'll sink into another Great Depression. We are going to have a severe recession (defined as negative GDP growth, meaning the economy shrinks compared to the previous quarter), but the things that happened to turn the 1929 recession into a ten-year depression are not happening.
Consider the actions of the Federal Reserve Bank, or "the Fed": in 1928 and 1929, they raised interest rates and shrunk the monetary supply by 7%. Right now, the Fed just pumped over $2 trillion dollars into the economy. And they cut rates by 1.5%. The Fed has acted quickly and decisively to add liquidity to the market.
The government also made the depression worse: they cut government spending by 25% and raised both corporate and individual tax rates. Currently, Congress is discussing a fourth round of stimulus, or government spending.
Finally, the depression was exacerbated by a world-wide trade war. While we are still negotiating the final pieces of a trade deal with China, we have fewer global protectionist policies and many more trade treaties.
We currently expect the economy to recover quickly once people are back at work. Remember to stay buckled up and hold on to the handrail until then; this wild ride isn't over yet. And in the meantime, here's a list of resources that you may find helpful:
  • Stimulus Checks: Checks should begin arriving this week. The New York Times has a great Q&A about the stimulus checks here.
  • Taxes: We are still accepting tax preparation clients. The deadline to file has been extended to July 15th.
  • Student Loans: Federal student loans have had payments and interest suspended for six months. Please visit for more information about the impact on student loans. 

  • Mortgage Forbearance: You can find more information on the Consumer Financial Protection Bureau's website.
  • Small Business Resources: The SBA has a suite of programs available for small businesses.
  • Your health: The CDC has reliable, accurate information to keep you and your family safe and healthy.
We are here for you, your questions, your concerns. Stay safe and well.