Why investors are spooked by the economic rebound

It sounds counterintuitive, but an increasingly healthy economy is making investors nervous, said Matt Phillips at The New York Times. Though they “had no trouble gliding past the death and economic devastation wrought by the pandemic,” the S&P 500 and other major indexes have wobbled in recent weeks despite the vaccine rollout, the prospects of another stimulus bill, and other positive signs of recovery. Instead, “worry that the economic rebound will cause inflation” has spooked investors. The “mere possibility of painful 1970s-style price growth” could cause the Federal Reserve to raise interest rates sooner than expected.


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