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So many people are trying to read the market conditions and restore a sense of certainty in their own minds, despite the current reality. Frankly, it\\u2019s hard to make sense of it all.
\\nIn an effort to gain greater insight, I\\u2019ve been in discussion with family offices, and attending invitation only meetings to get a reading on what some insiders are thinking.
\\nOn Tuesday evening I attended an invitation only session with John Stackhouse, Senior Vice President, RBC and Craig Wright, Senior Vice President & Chief Economist, RBC
\\nIn their remarks, they shared their perspective on what is happening in the economy. As Canada\\u2019s largest bank, they have direct visibility on what is happening since much of the cash in the economy flows through their bank accounts.
\\nExamining the value of transactions for both Visa and Debit cards, the bank has observed that after the initial surge of buying at grocery stores subsided, the current dollar volume of Visa credit card and debit card transactions is down by 60% compared with normal for this time of year.
\\nThat\\u2019s at the consumer end of the market.
\\nWhen the economics team at RBC plugged this into their model for the economy, it looks like a 32% drop in economic activity in about a month.
\\nThe RBC economics team sees a slow and gradual return to work. They don\\u2019t see the flash restart of the major sectors of the economy. Music festivals, crowded restaurants and bars, places of intense social interaction will be among some of the last to open up.
\\nIn the month of March, there were a number of notable, albeit predictable patterns in consumer spending.
\\nWe expect both buyers and sellers to lay low while extraordinary containment measures are in place. This will maintain a certain balance in most markets and help home prices stay afloat. Inventories have grown in some markets, but not dramatically.
\\nI don\\u2019t have the exact comparable data for the United States, but the shelter in place policies between Canada and the US are fairly similar and I would expect to see similar impacts in the US economy.
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