Green Fisher: “More robust than you think” – columns

Socially, Germany is still in a nationwide lockdown, but from an economic point of view the situation is more robust than many market observers perceive.

Not a typical recession

Socially, Germany is still in a nationwide lockdown, but from an economic point of view the situation is more robust than many market observers perceive. The manufacturing sector recently showed a monthly growth rate of 1.2 percent, while broad industrial production rose by 0.9 percent – the seventh month in a row with positive signs.

Tradition or not?

In a traditional recession, the manufacturing sector typically falls under the wheels. In lean times, companies cut drastically, stocks are cut, investments and production are radically cut. However, this situation did not occur following the corona shock in the first quarter of 2020. For investors, this is a clear indication that the economic contraction in 2020 was not a typical recession. The rapid comeback in the manufacturing sector was successful, as companies did not have to reduce excesses and at the same time various catch-up effects occurred as part of the easing.

The “old” cycle is alive!

In terms of figures, the markets were hit by a “real” bear market in the first quarter of 2020. With a price loss of 34 percent in the broad-market MSCI World Index, this discussion is actually irrelevant. And yet in many respects it is more realistic to interpret this development as an oversized correction. The robust numbers at the fundamental level suggest that we are, in a sense, late in the resumed cycle. This in turn speaks against a dynamic rise in growth as soon as the current lockdowns dissolve somewhat, but rather in favor of an environment with slow but robust growth. In the next step, it will be important to identify the first signs of irrationally high expectations.

When does the euphoria come?

The stock markets have long since adopted a far-sighted stance: They are looking at a world after the vaccine discussions, at a stabilized world with new opportunities. New all-time highs in numerous indices, already today, are the logical consequence – and these are arousing initial desires among investors. The general interest in investing in shares is gradually increasing. In view of the persistently low interest rates, the relative attractiveness has long been established, the returns achieved attract attention, and hot fashion topics are also fascinating. It is completely natural to be able to observe various hypes in parts of the economy, but a broad-based euphoria on the global stock markets would be a clear warning signal! This situation does not yet exist, but investors are well advised to keep a careful eye on this development. Until the dangerous euphoria, it is important to enjoy the dynamic returns in the late market cycle.


The market sentiment has become noticeably more optimistic in the last few weeks and months. This is not an immediate warning signal, even if investors are magically drawn to the stock market by one or the other hype. For investors with a sustainable orientation, the following still applies: stay cool, take rising prices with you in the late bull cycle, always keep a close eye on possible euphoria and find a healthy level of trust in the fundamental robustness of the economy.

You can request the current capital market outlook from Grüner Fisher Investments free of charge at

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