How to Tell When Markets Finally Reach a Bottom
Investors and traders would need to stop reacting negatively to every bad headline.
It’s one of the worst weeks for stocks since the financial crisis.
Photographer: Bloomberg
It’s said that the most expensive words on Wall Street are “this time is different.” But this might be one of the few times where the phrase applies.
Most of the rapid selloffs in equities in the post-financial crisis era were stemmed by forceful central bank statements, such as when then European Central Bank President Mario Draghi said in 2012 that he would do “whatever it takes” to save the euro during the height of the region’s debt crisis. Or, when current Federal Reserve Chair Jerome Powell made his “dovish pivot” in early January 2019 by saying the central bank would be “patient and flexible” when it came to considering future interest-rate increases.