by Colin Lloyd
The American Institute for Economic Research
For US stocks, the price action over the past three months has been quite unlike anything we have seen before. During the course of the recent pandemic many commentators drew comparisons with the Spanish Flu in 1919; however, the reaction of the US stock market was quite different at that time, consisting of a minor drop followed by a rally to new highs. The previous great pandemic came at the end of WWI, a time when the global economic situation was fundamentally different from today. If we cannot derive insight from comparison with the Spanish flu, except to hope that the outbreak will diminish as quickly as its predecessor, then perhaps we may glean some intelligence from a review of the last eight US bear markets.