The Halftime Report: Restructuring Recap for 1H 2019

These are strange times to make sense of for most business folks, including restructuring professionals. Financial markets have been volatile—sometimes schizophrenic but unbreakable as investors grapple with the slowing state of the global economy and the implications of President Trump’s risky strategy with respect to trade policy. His unconventional approach to managing the economy and trade, frequent use of his bully pulpit to pressure policymakers and public officials, and his walk-back of some economic threats have been vexing for impacted business leaders who must make critical decisions amid this unsettling environment. The president has certainly ratcheted up the uncertainty factor, and market fatigue is becoming more evident.

Fewer business leaders have any strong conviction about where our economy will be in 2020. That also includes most economists, who now peg the likelihood of a recession within the next year or so at 35%, the highest it has been since 2011. Some prominent market watchers are gloomier than that. However, investors remain more upbeat than the pundits and have kept markets aloft despite these nagging concerns, assuming all along that President Trump will not allow the economy to tank in an election year irrespective of his threats on trade, because that would be an act of political suicide. But one never knows exactly how these things will play out.

For those of us in the restructuring profession, well, let’s be honest: we anxiously await the arrival of an overdue downturn—and whenever that is, we’re a day closer to it every 24 hours. But let’s not allow the anticipation of the inevitable to distract us from the events of the moment or diminish what is happening right now.

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