Welcome to the thoughts of the market. I'm Andrew Sheets, Chief Cross Asset

Strategy for Morgan Stanley, along with my colleagues bringing a variety of

perspectives, I'll be talking about trends across the global investment landscape and how we put those ideas together.

It's Friday, May 1st, at 2 PM in London.

April 2020 is likely to go down as one of the weakest months for the economy and one of the

best months for stock markets in the last 50 years. That apparent disconnect

between what the economy is doing and what financial markets are doing has been getting a lot of attention from

the investors I speak to.

I wanted to talk today about why it might not be as unusual as it initially appears and

also what would worry us about this divergence.

While the stock market and the economy are

often mentioned in the same breath, they're fundamentally different things. The

stock market is an attempt to value all of a company's earnings from now, well into the future.

And that process is amplified by fear, greed, and other psychology that moving prices and

large amounts of money always bring.

The economy, meanwhile, is usually felt and framed by what is happening right now.

Do I have a job? Do I feel confident about making purchases? How easily can I afford the goods

that I need to get by?

That difference in time frame is extremely important because the economy is what's happening

now while stock markets are looking ahead, markets usually lead the economy. Looking back at the last recession

during the financial crisis, stock markets began to fall about four months

before the recession started and then they bottomed three months before it ended.

...