Today marks the 3-year anniversary of the COVID market low: March 23, 2020.
Three years ago today, mankind, civilization and global markets were reeling from the onset of COVID. The daily images of illness and death were real and shocking. The global economy had been purposefully shuttered. Markets were collapsing as global central banks tried to flood the system with enough financial oxygen to keep the system afloat. To put things in perspective, the VIX volatility contracts has historically spent less than 1% of its time above the >35 level. On March 23, 2020, the VIX contract traded at 66. Things were spinning and possibly spinning out of control.
Fast forward three years, and today the SP500 stands +76% higher, and that’s after 15 months of rate hikes and persistent market volatility. Over the past three years, employment recovered, medical innovation occurred, and markets recovered. Everyone got really, really good at Zoom.
My point is that all crisis eventually ends, including the current one that involves elevated inflation and interest rate policy. This crisis will pass, and we’ll collectively move onto whatever is next. Own quality, be diversified, and recognize that time is an enormous asset when it comes to investing and compounding. Warren Buffett has always said it best: our country has endured world war, political scandal, and senseless acts of terrorism and along the way grown wealth per capita exponentially larger due to hard work and genius and innovation. WB says never bet against the USA. I agree 100%.
I hope you have a nice March 23, 2023
Source: Bloomberg data as of March 23, 2023
Chief Investment Officer
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