According to the National Bureau of Economic Research, the U.S. economy slipped into recession one year ago, which means we have been in the thick of it for 12 months now.
The bigger question now is how long it will last.
To some extent, it pays to look at the historical record. History doesn't repeat itself, but it does tend to rhyme.
Here is a look at the durations of fourteen previous recessions, all of which we survived. They are:
- 1926-27....13 months
- 1929-33 ....43 months
- 1937-38... 13 months
- 1945.........8 months
- 1948-49....11 months
- 1953-54....10 months
- 1957-58....8 months
- 1960-61...10 months
- 1970........11 months
- 1973-75...16 months
- 1980.........6 months
- 1981-82....16 months
- 1990-91....8 months
- 2001.........8 months
As you can see, there have been many of them, and that is a lesson in and of itself. As bad as it may feel, recessions do happen. The good news is that the world doesn't come to an end, and neither do the markets.
Moreover, the median length of a recession has been 11 months. From a historical perspective that means we are likely getting closer to the end. And if we assume that this one will go as long as 24 months, now is actually the time when you would begin to see the signs of a stock market recovery.
And finally.....
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