Break-even math: How much gain is needed to recover from a loss fully?
Investors may undervalue the impact of investment losses and don’t know that more significant gains are needed to recover fully.
The 12-month changes in the consumer price index (CPI) climbed further in May to a 40+ year high. The lagged impacts of rapid money growth plus global supply shocks from the war in Ukraine and the rolling shutdowns of production in China continue to drive up food, energy, and commodity prices. Rapid inflation has also led to more hawkish pronouncements from central banks with the European Central Bank (ECB) setting the stage for reducing accommodation while the Fed is set to continue hiking rates this week.
The employment report for May showed how tight the labor market remains. Nationwide’s Chief Economist David Berson and Senior Economist Ben Ayers take a closer look at current employment conditions.
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The information in this report is provided by Nationwide Economics and is general in nature and not intended as investment or economic advice, or a recommendation to buy or sell any security or adopt any investment strategy. Additionally, it does not take into account any specific investment objectives, tax and financial condition or particular needs of any specific person.
The economic and market forecasts reflect our opinion as of the date of this report and are subject to change without notice. These forecasts show a broad range of possible outcomes. Because they are subject to high levels of uncertainty, they will not reflect actual performance. We obtained certain information from sources deemed reliable, but we do not guarantee its accuracy, completeness or fairness.
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