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Expand chart
Reproduced from FactSet and Alger; Note: Material slowing of GDP is defined as 50 bps or more of a negative change in the annual real GDP growth rate; Chart: Axios Visuals

Economists have been wearing out their keyboards over the past couple of months writing down expectations for U.S. and global economic growth.

Reality check: Alger chief investment officer Daniel Chung and director of strategy Brad Neuman point out that slower growth does not necessarily mean weak equity returns.

Chung and Neuman note:

  • "In the past 35 years, there have been 15 years when U.S. GDP growth materially slowed, with the vast majority generating positive U.S. stock returns."
  • "Returns were negative only when accompanied by a recession (1990, 2000/2001, 2008)"

Reading the graph: Of the 15 times in the last 35 years that year-over-year GDP growth has fallen by at least 50 basis points, or 0.5%, the S&P has still risen in 11 of the 15 years. The gains have been as high as 38% in 1995 and 32% in 2013.

Go deeper: Why you should stop worrying about a recession

Go deeper

46 mins ago - World

Netanyahu and Israel reluctantly adjust to a post-Trump Washington

Netanyahu (R) and Biden in 2010. Photo: Avi Ohayon/GPO via Getty

Prime Minister Benjamin Netanyahu and his close aides are very nervous about the transition to a new U.S. administration after a four-year honeymoon with Donald Trump. One Israeli official told me it felt like going through detox.

What he's saying: Netanyahu congratulated Biden minutes after he was sworn in, saying in a statement that he looked forward to working together to "continue expanding peace between Israel and the Arab world and to confront common challenges, chief among them the threat posed by Iran."

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. State of play: New coronavirus cases down, but more bad news ahead.
  2. Politics: Biden set to immediately ramp up federal pandemic response with 10 executive actions — Scoop: Joe Biden's COVID-19 bubble.
  3. World: Biden will order U.S. to rejoin World Health OrganizationBiden to bring U.S. into global COVAX initiative for equitable vaccine access.
  4. Vaccine: Amazon offers to help Biden administration with COVID vaccine efforts.
Dion Rabouin, author of Markets
3 hours ago - Economy & Business

First glimpse of the Biden market

Photo: Jonathan Ernst-Pool/Getty Images

Investors made clear what companies they think will be winners and which will be losers in President Joe Biden's economy on Wednesday, selling out of gun makers, pot purveyors, private prison operators and payday lenders, and buying up gambling, gaming, beer stocks and Big Tech.

What happened: Private prison operator CoreCivic and private prison REIT Geo fell by 7.8% and 4.1%, respectively, while marijuana ETF MJ dropped 2% and payday lenders World Acceptance and EZCorp each fell by more than 1%.

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