Time to buy?

MOST countries around the world are in lockdown, with much of economic activities suspended. The modern economy needs money to flow in order to function. Without the flow, large swathes of companies are in danger of going bankrupt.

To avert that, governments are opening their coffers in ways and magnitude unseen before. The word "unprecedented" is used almost every single day by journalists all over the world to describe the situation we are all going through. Large economies in the West are looking at 20 to 30 per cent contraction in GDP in the second quarter this year. Unemployment is skyrocketing. Infections are still climbing globally. We have not seen the peak, neither are we seeing light at the end of the tunnel yet.

Still, since the markets' violent lurch downward between mid-February and the fourth week of March, when the S&P 500 Index lost a third of its value, relative calm seemed to have returned. As of Thursday, the S&P 500 has clawed back about 25 per cent from its low on March 23. However, compared with Feb 19, it is still down by 17.4 per cent.