The Square-Root Recovery?

Charles Schwab Chief Investment Strategist Liz Ann Sonders says it’s becoming less likely that we’ll get a “W” recovery, and more likely that we’ll see a “square-root” recovery — one in which growth will be strong for a while, but then level off or slow down significantly.

Among the other interesting points from Sonders (who called the start of the recession back in late 2007 and may have hit the nail on the head again when she said it had ended this past June): She says right now a stronger-than-expected rebound in the economy may be a greater danger for stocks than a weaker-than-expected recovery, and she notes that unemployment has never peaked before a recession ends.

sonders

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