A report by Goldman Sachs shows that bear markets triggered by adverse events have – at least so far – passed faster and showed recoveries that were quicker than those caused by cyclical movements or structural problems.
Furthermore, event-driven bear markets showed smaller declines, with an average 29 percent loss, compared with an average 31 percent decline for cyclical bear markets and minus 57 percent for structurally caused ones.
The report looked at bear markets since 1800, including seven structural, 14 cyclical and five event-driven ones. Since the coronavirus is an ongoing event and adverse conditions for businesses might persist longer than they have for other events in the past, it is yet to be determined if the current bear market will follow these previous patterns.
