Economic statistics are lagging indicators so I don’t know whether the US and UK economies are in recessions, have been in recessions or are heading into recessions.
What is clear though is that these are tough times with both economies and much of euroland growing at below trend rates with a bias to rising unemployment. This is a state of affairs that politicians and central bankers will not want to continue so we can expect policy to move to an increasingly reflationary stance.
This in turn means that it is only a matter of time before economies recover and thereby provide a favourable backdrop for shares to resume an upward trend. Note that the US can reflate its economy merely by maintaining interest rates at current low levels; it doesn’t have to cut them further.
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