NEW YORK – Konstantinos (Gus) Lambropoulos is an Entrepreneur who recently partnered up with The Loan Source which is one of only 14 small business lending companies licensed by the U.S. Small Business Administration to make government-guaranteed small business loans as an Independent Loan Representative. With over 20 years of experience in financial services, Lambropoulos spoke with The National Herald on March 24 about the outlook for financial markets in 2020. He is also an Executive Board Member of The Hellenic Congress of America.
Lambropoulos told TNH, “in these challenging times, investors’ first reaction is to withdraw their funds from the markets. If I, myself, were a novice investor, I would take the same course of action. History has shown time, and, again, however, that our Financial markets are resilient. If we were looking back on Black Thursday, October 24, 1929, the markets were around 304 points and dropped to 230 points; this was a 25% drop over four days. This substantial drop in the Markets triggered a panic that caused all investors to think irrationally. Black Thursday, also broke the confidence of investors in the financial systems, and they began to withdraw all their savings even from banks, which ultimately resulted in the banking systems failing and required a ten-year recovery.
“In the Tech Bubble era, the NASDAQ rose over 400% and descended to 78% back in 2002, and investors lost a huge amount of their wealth, but it too recovered until the Great Recession.”
He continued, “the Great Recession was a global downturn that devastated world financial markets – banking and real estate industries. This economic crisis gave rise to an increase in home mortgage foreclosures worldwide, and sadly millions of people lost their life savings and their homes. We survived that too and then saw the longest bull run in history.”
About the current situation, Lambropoulos said, “we’re now in the Coronavirus-Pandemic Health Scare, and the whole world has shut down all non-essential businesses. People are socially distancing and everyone has to be in quarantine for 14 days to flatten the curve to save lives. The pandemic scare has also sent the financial markets into a downward spiral. Investors that were bought heavily on margin in the longest bull market in recorded history were not prepared to cover their margin calls. That has also contributed to the markets tanking at a quicker pace. The markets are trying to recover or just find a healthy heartbeat to find their way back into a healthy economy. This may presumably be a buyers’ market in the long run.”
He explained that “macroeconomics can influence the short term trajectory, but the midterm maybe is a bit more complicated, but again, history has shown we’re in this for the long run and today’s market uptick shows how truly resilient we are. An economic recovery bill, now before Congress, could result in an enhanced market rise.”
In addition to history, Lambropoulos also found solace in literature: “As John Milton wrote, over 350 years ago: ‘They also serve who only stand and wait.’”