While in some places life has mostly gotten back to normal following the Covid-19 pandemic, there are aspects of economies and markets that may have been altered permanently. Jared Gross, the head of institutional portfolio strategy at J.P. Morgan Asset Management, joined the What Goes Up podcast to discuss his team’s research into the post-pandemic landscape.  

According to Gross, some of the most-important legacies of the global health crisis will be disruptions to trade practices and the reaction of central banks to volatility in markets. Some highlights of the conversation:

“It’s a rewiring of trade. The big pipe between China and the developed markets is being split apart. There’s a lot of reshoring, onshoring, friendshoring, nearshoring—all of that stuff is going on, and it’s a real thing, and it’s going to change the way trade happens,” Gross said.  

Another big change is that investors can’t expect the US Federal Reserve to come to the rescue when markets wobble, he says. “The central bank put, which everyone used to talk about, has probably been replaced with a fiscal put. If you’re looking for a backstop for market volatility, you probably can’t depend on the monetary authorities as much as you used to, because they now have to be very careful given the amount of fiscal stimulus in the economy. They can’t just cut rates because stocks go down. They can’t just cut rates because a bank is wobbling.”

While in some places life has mostly gotten back to normal following the Covid-19 pandemic, there are aspects of economies and markets that may have been altered permanently. Jared Gross, the head of institutional portfolio strategy at J.P. Morgan Asset Management, joined the What Goes Up podcast to discuss his team’s research into the post-pandemic landscape.   According to Gross, some of the most-important legacies of the global health crisis will be disruptions to trade practices and the reaction of central banks to volatility in markets. Some highlights of the conversation: “It’s a rewiring of trade. The big pipe between China and the developed markets is being split apart. There’s a lot of reshoring, onshoring, friendshoring, nearshoring—all of that stuff is going on, and it’s a real thing, and it’s going to change the way trade happens,” Gross said.  
Another big change is that investors can’t expect the US Federal Reserve to come to the rescue when markets wobble, he says. “The central bank put, which everyone used to talk about, has probably been replaced with a fiscal put. If you’re looking for a backstop for market volatility, you probably can’t depend on the monetary authorities as much as you used to, because they now have to be very careful given the amount of fiscal stimulus in the economy. They can’t just cut rates because stocks go down. They can’t just cut rates because a bank is wobbling.”

Hosts Mike Regan and Vildana Hajric are joined each week by expert guests to discuss the main themes influencing global markets. They explore everything from stocks to bonds to currencies and commodities, and how each asset class affects trading in the others. Whether you’re a financial professional or just a curious retirement saver, What Goes Up keeps you apprised of the latest buzz on Wall Street and what the wildest movements in markets will mean for your investments.

Hosts Mike Regan and Vildana Hajric are joined each week by expert guests to discuss the main themes influencing global markets.

What Goes Up

How Covid Rewired Markets and the Economy

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/904abcfc-844f-4d96-97cd-b02901678015/transcript

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