Brace for a Trading Bounce or Recession — or Both
10/30/2023 12:00
Seldom do the stock market and the economy diverge quite this much, but they’re also more tightly linked than usual right now.
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The economy and the stock market are not the same thing, at all. In the short run, there’s no particular reason to expect them to move in the same direction, even though in the long run they both tend to grow, with occasional interruptions. At present, the disjunction seems extreme: Last month saw both a blowout number for third-quarter gross domestic product growth, of 4.9%, and a selloff in the stock market that brought the S&P 500 more than 10% below its recent peak — satisfying a popular definition of a “correction.”