Welcome to Thoughts on the Market.

I'm Mike Wilson, Chief Investment Officer and Chief US Equity Strategist for Morgan Stanley.

Along with my colleagues bringing you a variety of perspectives, I'll be talking about the latest

trends in the financial marketplace.

It's Tuesday, July 27th at 11.30 a.m. in New York.

So let's get after it.

Regular listeners are probably familiar with our mid-cycle transition narrative at this point.

However, today I'd like to reiterate it, given the news last week from the National Bureau

of Economic Research, or N-B-E-R.

The N-B-E-R is an organization that officially determines when recessions begin and end.

And last week they told us the COVID-19 recession was over in May of 2020, or just two months after it started.

While many investors lightly brush us off as old news, it explains a lot of the market's movements over the past year

and supports much of our investment thesis since the pandemic hit.

More specifically, COVID-19 was not only the steepest recession on record, but it was also the shortest.

Furthermore, the V-shape recovery and progression has been extraordinarily fast.

The combination of record monetary and fiscal stimulus, effective vaccines, and a digitized economy is orchestrated

to return to new highs in economic output and earnings in record time.

This is also why stock markets have rebounded new all-time highs in record time too.

In short, everything is happening faster than normal during this recession in recovery, and that's exactly

why we made the mid-cycle transition call back in March.

All that means is that we have reached the peak rate of change in the accelerated part of the recovery sooner than normal.

Typically, it takes about a year after the recession ends to reach that point of the cycle.

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