Factor #1 in our Road to Recovery Playbook is finding confidence in the peak of COVID-19 cases in the United States. At Epic Capital, we are monitoring this factor daily, and we wanted to provide an update into what we are seeing. As shown in the Chart of the Day, while the number of new cases in the United States has continued to climb, the number of new cases seen outside of the US has begun to drop in recent days. In fact, Italy, the worst-hit country in terms of total deaths from the virus, reported on Tuesday that new cases hit a two-week low.
This data is important because thus far the number of COVID-19 cases has conformed to Farr’s Law of Epidemics, exhibiting a somewhat predictable bell curve normal-like distribution. Formulated in the 1800s by British epidemiologist Dr. William Farr, these laws predict that epidemics normally follow a pattern of sharp increase, a peak, and then a decline back to a baseline.
The distributions of both new COVID-19 cases and related fatalities in China and South Korea have exhibited this behavior and appear to have ridden out the initial outbreak cycle. The City of Wuhan, China, which was the initial epicenter for the virus, reported on March 19 that it had zero new cases—showing us that the curve can be flattened and there is light at the end of this dark tunnel.
“The market’s bounce last week may have been in anticipation of some of these more positive data points regarding the virus,” said LPL Market Strategist Ryan Detrick. “While US cases continue to climb, the more countries that reach their peak, the more clarity we gain into what that timing may look like for the United States. Investors have historically been rewarded for investing during these crisis events, and we believe the time for suitable investors to consider adding some risk to their portfolios may be approaching.”
Recently, you may have seen reports that a record-low number of homes are available for sale—roughly 1.03 million nationwide. If you compare that to the average number of homes for sale during the past 10 years, it’s no surprise that many hopeful homebuyers are having issues securing a home. But why exactly is the housing … Continue reading “Forces Driving the Housing Market”
It can be exhausting trying to keep up with the whims of Wall Street. Lately, the financial markets have been fixated on federal taxes and what may be proposed on Capitol Hill in the weeks and months ahead. Wall Street’s focus on taxes closely follows its attention on the 10-year Treasury yield. And it wasn’t … Continue reading “The Whims of Wall Street”
President Joe Biden introduced the much-anticipated American Jobs Plan, which outlines an approach to spend roughly $2.2 trillion on the nation’s infrastructure and other projects. As part of the legislative process, the Biden administration also laid out a proposal for paying for the domestic investment. The plan includes raising the corporate tax rate to 28% … Continue reading “Paying for the Infrastructure Bill”
Financially, many of us associate the spring with taxes – but we should also associate December with important IRA deadlines. This year, like 2020, will see a few changes and distinctions. December 31, 2021, is the deadline to take your Required Minimum Distribution (RMD) from certain individual retirement accounts.
There’s an old Wall Street maxim that says, “markets climb a wall of worry.” And these days, there’s plenty to worry about with the trend in long-term interest rates and bonds.
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