The COVID pandemic generated some new terminology when it comes to measuring economic activity.
We needed new words because we had not been through a pandemic for a century and the language of those days simply didn’t hold up today.
One of the new expressions we heard was a “V-shaped” versus a “U-shaped” recovery or rebound. This refers primarily to stock markets and how quickly they would respond to a dip.
For the most part, it didn’t take long for investor confidence to be restored and we generally got the quick rebound. But it had observers talking about the slower version of that recovery, the one that would produce a U-shaped graph or chart.
This terminology has been dragged out again in light of talk of a recession, especially in the US. The investment firm Edwards Jones says in its weekly report to watch for a U-shaped recovery from recent stock market pullbacks because a recession is not a foregone conclusion.
Basically, the firm is arguing we are in for a slow but steady growth period, not an economic contraction.
