According to a recent Morningstar article, the firm’s U.S. Market Index has “come thundering back since its late March nadir and is now down merely 7% year to date, even as the coronavirus pandemic persists.”

The article argues that, while many investors are suspecting “irrational exuberance” on the part of investors, Morningstar believes the market’s bounce-back to be “broadly warranted.”

“We expect the U.S. GDP to drop 5.1% in 2020 but surge back in 2021 and experience further catch-up growth in following years. By 2024, we think U.S. GDP will recover to just 1% below our expectations before the pandemic.”

Despite the impact that continued social distancing measures are having on some industries, Morningstar cites retail sales, employment and other data as evidence that “this recovery has already begun for the U.S. We expect broad availability of a vaccine to erase the coronavirus’ direct impact on the U.S. and global economies by mid-2021.”

The article says that an analysis of historical data related to global recessions showed that “many recessions don’t have a long-run impact on the economy” and the worst among them have been the product of “persistent economic policy error.” In the case of this pandemic, the article notes that the policy response has been “extremely impressive, especially the United States’ historically large fiscal stimulus.”

The article concludes: “Underlying structural issues going into this recession pale compared with the economic distortions before the Great Recession. We forecast a long-run impact on U.S. and global GDP of just negative 1%.”