20+% US unemployment rate, 26+ million US jobs lost, -5% GDP, $2 Trillion added to federal deficit, all in a couple months’ time. Without context, one might surmise these numbers reflect the economic impact of the Stock Market crash of 1929, right? Wrong. These metrics (updated stats coming soon) are the pain inflicted due to COVID19 in March-Mid April 2020. Yet, miraculously, the S&P 500 is clawing at the 3,000 level overhead, now only down ~10% from the February 2020 all-time high of ~3,340.

Now, it’s important to realize the economy and stock market are not correlated, at least not directly. But one has to wonder: With economic fundamentals rivaling the Great Depression nearly a century ago, record-high unemployment, company bankruptcies, a commercial property exodus, government bailouts, government-sponsored life raft SBA loans, and negative GDP truly support high equity market valuations? One can’t help but wonder if this is a dead cat bounce and fair market value can be taken advantage of with more downside yet to come. We suspect this may be one of those all too common opportunities where a patient investor is simply getting paid to wait for a better opportunity.