The stock market’s sudden slide this week is not the harbinger of a recession.
That’s the word from Commerce Trust Company chief economist Scott Colbert.
"This is a typical correction. We’re starting to see that. It takes a long time to play out. We’re in the middle of it. You need a couple of good things to help you break the momentum on the downside, but that’s likely to happen," Colbert said.
Stock market drops of 49 and 55 percent came ahead of recessions in 2000 and 2008. Colbert said besides this week's dip, the market has been strong.
"You’ve just lived through the longest bull market that we’ve ever had without a 20 percent correction, and you’ve just accumulated the second-highest returns, only to be exceeded by the one from 1990 to 2000, when we had the internet bubble," Colbert said.
Colbert said there will be another recession, but he does not expect it until early 2023. Colbert said investors may want to consider moving some of their stock market "winnings" to more conservative investments, though.
