Skip to main content
logo
Financial Professional Login
Welcome
Log in for exclusive access and a personalized experience
Log in Sign up
Benefits of creating a free account
  • Customize our Guide to the Markets and unlock bonus slides
  • Utilize our award-winning Portfolio Construction and Retirement Planning Tools
  • Access expert commentary from Dr. David Kelly and more...
Hello
  • My Collections
    View saved content and presentation slides
  • Products

    Products

    • Mutual Funds
    • ETFs
    • SmartRetirement Funds
    • 529 Portfolios
    • Alternatives
    • Money Market Funds
    • Commingled Funds
    • Featured Funds

    Asset Class Capabilities

    • Fixed Income
    • Equity
    • Multi-Asset Solutions
    • Alternatives
    • Global Liquidity
  • Investment Strategies

    Investment Approach

    • ETF Investing
    • Model Portfolios
    • Separately Managed Accounts
    • Sustainable Investing
    • Variable Insurance Portfolios
    • Commingled Pension Trust Funds

    College Planning

    • 529 College Savings Plan
    • College Planning Essentials

    Defined Contribution

    • Retirement Solutions
    • Target Date Strategies
    • Startup and Micro 401(k) Plan Solutions
    • Small to Mid-market 401(k) Plan Solutions
  • Insights

    Market Insights

    • Market Insights Overview
    • Guide to the Markets
    • Quarterly Economic & Market Update
    • Guide to Alternatives
    • Market Updates
    • On the Minds of Investors
    • Principles for Successful Long-Term Investing
    • Weekly Market Recap

    Portfolio Insights

    • Portfolio Insights Overview
    • Asset Class Views
    • Equity
    • Fixed Income
    • Long-Term Capital Market Assumptions
    • Monthly Strategy Report
    • Sustainable Investing

    Retirement Insights

    • Retirement Insights Overview
    • Guide to Retirement
    • Principles for a Successful Retirement
    • Defined Contribution Insights
  • Tools

    Portfolio Construction

    • Portfolio Construction Tools Overview
    • Portfolio Analysis
    • Model Portfolios
    • Investment Comparison
    • Bond Ladder Illustrator

    Defined Contribution

    • Retirement Plan Tools & Resources Overview
    • Target Date Compass®
    • Core Menu Evaluator℠
    • Price Smart℠
  • Resources
    • Account Service Forms
    • Tax Planning
    • News & Fund Announcements
    • Insights App
    • Events
    • Library
    • Navigating market volatility
  • About Us
    • Diversity, Equity, & Inclusion
    • Sustainable Investing
    • Media Resources
  • Contact Us
  • Role
  • Country
  • Shareholder Account Login
    Hello
    • My Collections
      View saved content and presentation slides
    • Log out
    Financial Professional Login
    Welcome
    Log in for exclusive access and a personalized experience
    Log in Sign up
    Benefits of creating a free account
    • Customize our Guide to the Markets and unlock bonus slides
    • Utilize our award-winning Portfolio Construction and Retirement Planning Tools
    • Access expert commentary from Dr. David Kelly and more...
    Log out
    Search
    Search
    Menu
    You are about to leave the site Close
    J.P. Morgan Asset Management’s website and/or mobile terms, privacy and security policies don't apply to the site or app you're about to visit. Please review its terms, privacy and security policies to see how they apply to you. J.P. Morgan Asset Management isn’t responsible for (and doesn't provide) any products, services or content at this third-party site or app, except for products and services that explicitly carry the J.P. Morgan Asset Management name.
    CONTINUE Go Back
    1. Should I be worried about another recession?

    • LinkedIn Twitter Facebook Line

    Should I be worried about another recession?

    07/21/2021

    David Lebovitz

    It is reasonable to believe that at some point we will see the U.S. economy return to a trend pace of growth, and furthermore, it would not be surprising for the recovery to be a bit more uneven that was originally anticipated.

     David M. Lebovitz

    David M. Lebovitz

    Global Market Strategist

    Listen to On the Minds of Investors

    07/21/2021

    This week began with a risk-off tone. On Monday, the S&P 500 logged its worst day since May and the STOXX 600 saw its largest daily decline in 2021. COVID-sensitive assets were hit the hardest, as airlines, banks and energy stocks all fell sharply. Against this risk-off backdrop, the 10-year U.S. Treasury yield fell to its lowest level since February as both inflation breakevens and real rates moved lower, the yield curve flattened, and the U.S. dollar strengthened. 

    It is difficult to pinpoint exactly what drove this sell-off – in our view, it was a function of a number of factors. To start, rising case counts in the U.K., driven by the delta variant, serve as a reminder that the return to normal may not be as easy as some had assumed. At the same time, recent research from the San Francisco Fed and U.C. Davis has highlighted that in contrast to wars, pandemics induce labor scarcity, more precautionary savings, and put downward pressure on the natural rate of interest. Furthermore, the announcement that the pandemic-induced recession clocked in at just two months (ending in April 2020, making it the shortest on record) has led some investors to question if we are already late cycle, just one year into this expansion. And on top of that, a new set of economic projections from the Congressional Budget Office (CBO) point to below-trend growth taking hold by 2023. 

    It is reasonable to believe that at some point we will see the U.S. economy return to a trend pace of growth, and furthermore, it would not be surprising for the recovery to be a bit more uneven than was originally anticipated. However, we see reasons to remain optimistic. To start, consumer banking data still points to the presence of substantial reserves, which should provide a tailwind for consumer spending (which is 68% of GDP) as the economy reopens. While the research on post-pandemic behavior highlighted above suggests that consumers may be cautious, substantial support from the federal government suggests the consumer is in a very different place than is usually the case emerging from a pandemic. At the same time, the past 12 months have seen very robust consumption of goods, rather than services – this has led inventories to decline substantially, and the rebuilding process should provide solid support for growth over the coming quarters.

    People always debate whether the stock market or bond market is correct. In this case, they both seem to be wrong, but the stock market seems to be “more right.” The current level of the 10-year U.S. Treasury yield suggests negative real growth over the coming year; this is possible, but not probable. Meanwhile, equities rebounded smartly on Tuesday as investors took a deep breath. While we would not be surprised to see volatility remain elevated through the end of the summer, we continue to embrace cyclicality in portfolios through allocations to value, small caps, international equities, and high yield credit.

    1 Jorda, Singh and Taylor. Longer-run economic consequences of pandemics. Federal Reserve Bank of San Francisco, University of California, Davis. February 2021.

    Net inventories point to rebuilding in the coming quarters

    New orders/inventories, ratio

    New orders/inventories, ratio

    Sources: ISM, FactSet, J.P. Morgan Asset Management.

    Data are as of July 20, 2021.

    09pp212007194134

    • Equities
    • Global economy
    • Fixed Income

    EXPLORE MORE

    On the Minds of Investors

    What investment questions are on the minds of investors? Explore the questions investors ask frequently and find answers at J.P. Morgan Asset Management.

    Read more

    Guide to the Markets

    The J.P. Morgan Guide to the Markets illustrates a comprehensive array of market and economic histories, trends and statistics through clear charts and graphs.

    Read more

    Capitalize on the growing economic recovery

    Learn how mispricings across markets may provide opportunities to find growth over the long run.

    Read more
    J.P. Morgan Asset Management

    • Capital Gains Distributions
    • eDelivery
    • Fund Documents
    • Glossary
    • Help
    • How to invest
    • Important Links
    • Mutual Fund Fee Calculator
    • Accessibility
    • Form CRS and Form ADV Brochures
    • Investment stewardship
    • Privacy
    • Proxy Information
    • Senior Officer Fee Summary
    • SIMPLE IRAs
    • Site disclaimer
    • Terms of use
    J.P. Morgan

    • J.P. Morgan
    • JPMorgan Chase
    • Chase
    Opens LinkedIn site in new window Opens Youtube site in new window Opens Twitter site in new window

    This website is a general communication being provided for informational purposes only. It is educational in nature and not designed to be a recommendation for any specific investment product, strategy, plan feature or other purposes. By receiving this communication you agree with the intended purpose described above. Any examples used in this material are generic, hypothetical and for illustration purposes only. None of J.P. Morgan Asset Management, its affiliates or representatives is suggesting that the recipient or any other person take a specific course of action or any action at all. Communications such as this are not impartial and are provided in connection with the advertising and marketing of products and services. Prior to making any investment or financial decisions, an investor should seek individualized advice from personal financial, legal, tax and other professionals that take into account all of the particular facts and circumstances of an investor's own situation.

     

    Opinions and statements of financial market trends that are based on current market conditions constitute our judgment and are subject to change without notice. We believe the information provided here is reliable but should not be assumed to be accurate or complete. The views and strategies described may not be suitable for all investors.

     

    INFORMATION REGARDING MUTUAL FUNDS/ETF: Investors should carefully consider the investment objectives and risks as well as charges and expenses of a mutual fund or ETF before investing. The summary and full prospectuses contain this and other information about the mutual fund or ETF and should be read carefully before investing. To obtain a prospectus for Mutual Funds: Contact JPMorgan Distribution Services, Inc. at 1-800-480-4111 or download it from this site. Exchange Traded Funds: Call 1-844-4JPM-ETF or download it from this site.

     

    J.P. Morgan Funds and J.P. Morgan ETFs are distributed by JPMorgan Distribution Services, Inc., which is an affiliate of JPMorgan Chase & Co. Affiliates of JPMorgan Chase & Co. receive fees for providing various services to the funds. JPMorgan Distribution Services, Inc. is a member of FINRA  FINRA's BrokerCheck

     

    INFORMATION REGARDING COMMINGLED FUNDS: For additional information regarding the Commingled Pension Trust Funds of JPMorgan Chase Bank, N.A., please contact your J.P. Morgan Asset Management representative.

     

    The Commingled Pension Trust Funds of JPMorgan Chase Bank N.A. are collective trust funds established and maintained by JPMorgan Chase Bank, N.A. under a declaration of trust. The funds are not required to file a prospectus or registration statement with the SEC, and accordingly, neither is available. The funds are available only to certain qualified retirement plans and governmental plans and is not offered to the general public. Units of the funds are not bank deposits and are not insured or guaranteed by any bank, government entity, the FDIC or any other type of deposit insurance. You should carefully consider the investment objectives, risk, charges, and expenses of the fund before investing.

     

    INFORMATION FOR ALL SITE USERS: J.P. Morgan Asset Management is the brand name for the asset management business of JPMorgan Chase & Co. and its affiliates worldwide.

     

    NOT FDIC INSURED | NO BANK GUARANTEE | MAY LOSE VALUE

     

    Telephone calls and electronic communications may be monitored and/or recorded.
    Personal data will be collected, stored and processed by J.P. Morgan Asset Management in accordance with our privacy policies at https://www.jpmorgan.com/privacy.

     

    If you are a person with a disability and need additional support in viewing the material, please call us at 1-800-343-1113 for assistance. 

     

    Copyright © 2022 JPMorgan Chase & Co., All rights reserved