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March-End Economic Snapshot

Investing – 3/26/2020

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By Thierry J. D. Brunel

Director, Matter Family Office


For the most part, economic data will show some level of lag depending on the data point and frequency. The Conference Board Leading Economic Index looks to provide some level of forward-looking insight by aggregating different data points which include manufacturing output, unemployment claims, stock market and credit conditions, and a handful of others. We look at a host of different data points, but below is a summary that might prove helpful: 

  • Weekly unemployment claims, which are reported every Thursday morning, provide a relatively immediate read on the employment situation. This week’s number of new claims was a clear indication of the immediate nature of the mandated lockdowns across the country and how they have impacted people’s jobs. A record 3.3 million people filed for unemployment last week—to put that number into perspective, the previous record was 695,000 in October 1982. 
  • Monthly Purchasing Managers Index (PMI) data provides a relatively timely indication in the change of business activity from month to month, as well as some longer-term trend data when taken over several months. ISH Markit published flash reports for March earlier this week and those similarly reflect the immediate impact of the slowdown from February to March. Across the US, UK, Eurozone and Japan, the decline in readings between February and March marked the steepest declines since they began tracking the data—again illustrating the truly unique nature of the economic shutdown taking place to combat the spread of COVID-19. 
  • From an economic output perspective, GDP growth (or decline) estimates vary, reflecting the uncertainty surrounding the timing of when business activity will be able to “return to normal.”
    • Moody’s cut their Global GDP growth estimates from 2.6% in January (prior to the outbreak) to their most recent estimate of a contraction of 0.4%.
    • The IMF will be publishing the World Economic Outlook in April, and we anticipate a significant reduction in the prior forecast from January, which expected global growth to hit 3.3% in 2020. 

Ultimately, the economic data will retrospectively tell the story of how things were, better than it will predict the story that is yet to come. However, as we watch this situation unfold, understanding the magnitude of the disruptions helps put context around the trajectory of the economy and how it will impact the financial performance of the businesses in which we invest. 


This report is the confidential work product of Matter Family Office. Unauthorized distribution of this material is strictly prohibited. The information in this report is deemed to be reliable but has not been independently verified. Some of the conclusions in this report are intended to be generalizations. The specific circumstances of an individual’s situation may require advice that is different from that reflected in this report. Furthermore, the advice reflected in this report is based on our opinion, and our opinion may change as new information becomes available. Nothing in this presentation should be construed as an offer to sell or a solicitation of an offer to buy any securities. You should read the prospectus or offering memo before making any investment. You are solely responsible for any decision to invest in a private offering. The investment recommendations contained in this document may not prove to be profitable, and the actual performance of any investment may not be as favorable as the expectations that are expressed in this document. There is no guarantee that the past performance of any investment will continue in the future. 

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