What will the post COVID economic recovery look like?

With the bulk of the economic damage by COVID theoretically behind us, analysts and journalists are trying to predict what the recovery will look like. What is most popular and one you have likely heard of is what is the “V-shaped” recovery. You may also have heard of the double dip recession (also given a variant of “W-shaped” recovery).

 

 

This FT article talks about the various recovery predictions that we are aware of. They go over a number of different “shapes” ranging from the popular to the more obscure. They point out that the V-shaped recovery was by far the most popular outcome being touted by pundits. This, of course, is a position that has since changed.

The most optimistic forecast of the bunch — the V-shaped rebound — was once enthusiastically adopted, as some analysts likened lockdowns to a self-induced coma. But many investors and policymakers have now dismissed that idea, suggesting a much less robust resurgence after what may well be the worst economic downturn since the Great Depression.

Other media outlets talking about the aftermath of COVID have their own predictions of the shape of the economic recovery. This video from the WSJ has useful information for those looking to learn more:

Conclusion

Only time will tell what shape the economic recovery looks like. While the stock market is resembling a V-shaped recovery, the unemployment claims give a mixed message.

As global economies recover by continuing to reopen, and investor sentiment improves, huge buying opportunities for TSXV listed stocks have been emerging. Many stocks had dropped in value due to COVID-19. A significant number remain depressed. This is a buying opportunity for those who want to see multi-digit returns.

One excellent opportunity that has been observed is the bull run on Iron Ore. We recently talked about how Iron Ore has beaten Gold BY MORE THAN 2X!! The right Iron Ore penny stocks / microcaps on the TSXV is a fantastic way to position yourself for the post-Covid-19 economic recovery. We remain bullish on Black Iron Inc (TSX:BKI) and you can find the full report here.