There’s an alphabet soup of possible outcomes for the economy, and now one mathematical symbol, too.
Some strategists expect the shape of the recovery to resemble a “V”: growth rocketing straight up and to the right after months of pent-up energy. Others more cautiously propose a gradual curve, like a “U.” Alternately, a “W” might suggest a double-dip recession.
Now add to that alphabet soup a square root, which is what analysts at Ned Davis Research are forecasting. If you thought math class was a slog, the economy visualized by a square-root symbol won’t warm your heart.
Read:Why the S&P 500 outlook depends on what letter of the alphabet the coronavirus recovery looks like
The Ned Davis analysts, Pat Tschosik and Rob Anderson, didn’t coin the phrase. Famed investor George Soros may have been the first to use it.
At a particularly fraught moment in 2009, just after the stock market bottomed and a few months before the official end of the 2007-09 recession, Soros told Reuters that the economy would naturally bounce a bit after it hit bottom, but then would “settle” into a prolonged period of subpar growth — a “lasting slowdown” that would look like an “inverted square-root sign.”
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