Magnitude is relative (cont’d)

Looking back on the timeline, the market changed course sharply from its downfall around the time the fiscal rescue package was done. The bill was approved in the Senate on March 25, but word about its magnitude and substance had been spreading.

Yahoo Finance source chart

Now that the market has had some time to digest the package and its economics, and factoring in portfolio maneuvers on the before and after side of quarter-end March 31, we’re roughly 15% ahead of the pre-bill low.

On its face, the $2.2 trillion package seems to have been fashioned as an exact stopgap of 10% on a $22 trillion GDP economy. Whether the order of magnitude is correct, sufficient, insufficient, headed for another round, is a subject of continuing discussion…

Magnitude is relative – March 25

… and it looks as though another round is being considered, which probably is not yet priced in.

These are all questions and responses based on magnitude, with the implied understanding that the dollar amount will be a GDP refill, bridging the economy at least somewhat to the other side of the disruption.

Listening in on several expert calls these past few days, to discuss the bells and whistles, consequences and conditions, procedural dynamics, federal and state authority, degrees of benefit and assorted options that require further consideration by all businesses, small and large, based on incomplete knowledge, before even getting to the point of action… a point at which the funds flow will not be immediate, but will still need to pass through bureaucratic protocols that are themselves less than prepared for orderly movements…

Learning about the details of these matters in the enterprise, which don’t seem to be dissimilar at the individual level…


I wonder if aspects of efficiency and speed of rescue have still to be priced in. (As I’m writing this post, stock futures are jumping.)

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