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Recession Physics—The More Than Equal and Opposite Reaction

by Gregory M. Drahuschak January 23, 2023
An old cliché says that the market has discounted nine of the last two recessions.

Perhaps this will apply again as some people call an anticipated economic downturn the most widely forecast recession in memory while others debate whether it is a first-half or second-half event. Nonetheless, talk of a possible recession permeates financial discussions.

Although it is not absolute, the standard definition of a recession is two consecutive quarters of negative gross domestic product (GDP) growth. It probably is better to characterize a recession as a significant, widespread, and lengthy downturn in economic activity.

Recessions are not common, but not unusual either. Since World War II through 2020, the United States experienced 13 different recessions that on average lasted 10 months. Economic expansions on the other hand have lasted an average of 57 months

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This report is provided for informational and educational purposes only and shall in no event be construed as an offer to sell or a solicitation of an offer to buy any securities or a recommendation for any strategy or to buy, sell, or hold any product. Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation, or needs of individual investors. Employees of Janney Montgomery Scott LLC or its affiliates may, at times, release written or oral commentary, technical analysis, or trading strategies that differ from the opinions expressed here. The information described herein is taken from sources which we believe to be reliable, but the accuracy and completeness of such information is not guaranteed by us. The opinions expressed herein may be given only such weight as opinions warrant. This Firm, its officers, directors, employees, or members of their families may have positions in the securities mentioned and may make purchases or sales of such securities from time to time in the open market or otherwise and may sell to or buy from customers such securities on a principal basis. This report is the intellectual property of Janney Montgomery Scott LLC (Janney) and may not be reproduced, distributed, or published by any person for any purpose without Janney’s prior written consent. This presentation has been prepared by Janney Investment Strategy Group (ISG) and is to be used for informational purposes only. In no event should it be construed as a solicitation or offer to purchase or sell a security. Past performance is no guarantee of future performance and future returns are not guaranteed. There are risks associated with investing in stocks such as a loss of original capital or a decrease in the value of your investment. For additional information or questions, please consult with your Financial Advisor.

About the author

Gregory M. Drahuschak

Equity Market Analyst, ISG

Read more from Gregory M. Drahuschak

Related Articles

Recession Physics—The More Than Equal and Opposite Reaction

by Gregory M. Drahuschak January 23, 2023
An old cliché says that the market has discounted nine of the last two recessions.

Perhaps this will apply again as some people call an anticipated economic downturn the most widely forecast recession in memory while others debate whether it is a first-half or second-half event. Nonetheless, talk of a possible recession permeates financial discussions.

Although it is not absolute, the standard definition of a recession is two consecutive quarters of negative gross domestic product (GDP) growth. It probably is better to characterize a recession as a significant, widespread, and lengthy downturn in economic activity.

Recessions are not common, but not unusual either. Since World War II through 2020, the United States experienced 13 different recessions that on average lasted 10 months. Economic expansions on the other hand have lasted an average of 57 months

Continue to read the full PDF

This report is provided for informational and educational purposes only and shall in no event be construed as an offer to sell or a solicitation of an offer to buy any securities or a recommendation for any strategy or to buy, sell, or hold any product. Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation, or needs of individual investors. Employees of Janney Montgomery Scott LLC or its affiliates may, at times, release written or oral commentary, technical analysis, or trading strategies that differ from the opinions expressed here. The information described herein is taken from sources which we believe to be reliable, but the accuracy and completeness of such information is not guaranteed by us. The opinions expressed herein may be given only such weight as opinions warrant. This Firm, its officers, directors, employees, or members of their families may have positions in the securities mentioned and may make purchases or sales of such securities from time to time in the open market or otherwise and may sell to or buy from customers such securities on a principal basis. This report is the intellectual property of Janney Montgomery Scott LLC (Janney) and may not be reproduced, distributed, or published by any person for any purpose without Janney’s prior written consent. This presentation has been prepared by Janney Investment Strategy Group (ISG) and is to be used for informational purposes only. In no event should it be construed as a solicitation or offer to purchase or sell a security. Past performance is no guarantee of future performance and future returns are not guaranteed. There are risks associated with investing in stocks such as a loss of original capital or a decrease in the value of your investment. For additional information or questions, please consult with your Financial Advisor.

About the author

Gregory M. Drahuschak

Equity Market Analyst, ISG

Read more from Gregory M. Drahuschak

Related Articles

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