Your Predictions for the post Covid-19 Economy?

[Midpack]

I’ve posted a link to a USA Today article below, just as food for thought. We haven’t seen the ultimate impact on our economy or markets yet, both will get worse before they get better IMO. Some industries have and will benefit (e-commerce, tech) but some will suffer huge setbacks (travel, leisure, hospitality, entertainment) and they’re staying afloat draining their reserves and/or through various bailouts - that will end sooner or later. And when those industries find their new contracted equilibrium, the displaced workers are going to be competing for scarcer jobs, the best jobs with qualifications that will be out of reach for many.

Hopefully we won’t have a downturn as deep or prolonged as the 30’s depression (and I’m not predicting it will be that bad).

And some predict that we might lose reserve currency status on the next 10-20 years?

As several have pointed out in the past few weeks, people’s behavior has become a bigger determinant than government (in)action at least in the US. I don’t think governments could effectively impose a lockdown again if they wanted, they had that chance and it’s past.

https://www.usatoday.com/story/opin...hat-comes-next-predictions-column/5535736002/

 

[travelover]

I agree with most of the points in the article. Once the slug of money initially thrown at the pandemic is spent, we are in for a lot of economic turmoil as we wait for it to be safe to resume normal activities like travel, eating out and sending kids to school. Evictions, foreclosures and local/state government layoffs will really accelerate in the coming months and this will have a snowballing effect.

 

[Eucerin]

As much as the stock market is going upward, I believe there are plenty of bubbles in it.
Really, base on the unemployment rate, domestic hatred chaos, international trade sanctions, monetary policy- printing cash, fiscal police- politics driven, and most of all - our health crisis is being played in politician's hands - people are dying, all these combined that creating a perfect storm. The storm is coming soon, very soon...

 

[audreyh1]

I can't even see past the end of this year!!!

I'm very worried that we are going to have many outbreaks from the return to school attempts well before that even.

 

[Eucerin]

And some predict that we might lose reserve currency status on the next 10-20 years?

Prior covid-19, there were few countries openly manipulated US currency. Ironically the covid-19 has saved US some time to get the currency stronger. But due to the way that US handles covid-19, the US dollar has devalued without manipulation.
I am afraid some prediction of US losing reserve currency status is becoming true due to our own doing.

 

[brewer12345]

I imagine the bubble in asset markets will pop, the status of the dollar as the reserve currency will be impaired,and the main street economy is in for a rough few years. Evictions and high unemployment will ensure continued riots and escalating violence in major cities. A s###show.

 

[Sunset]

Post covid-19 , to me means a very effective vaccine if we are talking about within a year or two.

I think tourism will bounce back like a rocket, prices will be higher simply as many players will be out of the business either by bankruptcy or reduction in capacity, so that will limit tourism but not the income from it.

Many landlords will go bankrupt if evictions are continued to be banned. This will result in less rental housing being available, making the problem worse in the end.

If Post-Covid-19 means after natural herd immunity since no vaccine was developed, it means after many many years, so tourism will then be pretty dead, along with restaurants (except takeout).

 

[SpinDoctorTX]

We haven’t seen the ultimate impact on our economy or markets yet, both will get worse before they get better IMO.

Agreed- almost everything is a moving target just now.

I can't even see past the end of this year!!!

I'm very worried that we are going to have many outbreaks from the return to school attempts well before that even.

That's already happening so widely I don't see how we can possibly avoid a spike in cases. The statistics are terrifying really, and the worst outcome possibilities continue to worsen.

I can't see past the end of this year either.

I imagine the bubble in asset markets will pop, the status of the dollar as the reserve currency will be impaired,and the main street economy is in for a rough few years. Evictions and high unemployment will ensure continued riots and escalating violence in major cities. A s###show.

This is the perfect storm, that's for sure. I can only hope that we as a society change for the better as we live through these days.

 

[Rianne]

Vaccines, viruses, medicine were not understood during the plagues of the past. This article goes back to the 1300’s and how economies survived and recovered after the plagues passed. The article is a bit long but is interesting and many comparisons to today. In a way, this article encourages me to remain in the market. It’s a good read if you’re interested.

https://getpocket.com/explore/item/how-pandemics-past-and-present-fuel-the-rise-of-large-companies

 

[Ronstar]

I agree with the article. The next year or more is going to be an economic s***storm. The current economy is being propped up by the gov’t and the propping can’t continue through the whole lifespan of the pandemic.

And the length and strength of the storm will be dependent on how long it takes to get treatment and/or vaccine to the masses.

About the only entities that will be ok are e-business, e-learning, e-whatever.

 

[Car-Guy]

Personally, I don't think the virus will be the biggest economic driver/impact looking 2 to 5 years out.

 

[Markola]

Though-provoking article. There is a lot of pain right now and, I believe, more coming in the next couple of years for a lot of people. I thought the most interesting part was the opinion that people will demand a more activist government, given the scope of the emergency needs.

Still, recessions have always had silver linings in forcing needed creative destruction, including killing off of companies that no longer fulfill a need. For example, do we need so many airlines? In fact, do we need to fly so much? No, we do not. I once worked for a global environmental organization whose executives essentially lived on airplanes. I was twice flown 1,500 miles for performance reviews with my boss, which was stupid, wasteful and bad for the climate. There is a lot of pain, crisis and need out there but there is also a massive amount of expensive fat that this flabby country does not need and can learn to do without.

 

[Dwhit]

I think things will return to normal, post Covid, as things did post Spanish Flu, fairly quickly. No disease, no worries.

However, with this Covid outbreak, we have shut down our economy to a much higher degree than during the Spanish Flu. Not sure about the long term effects of that decision. Might be a bit more troublesome.

 

[Fermion]

After the Spanish flu, we had the roaring 20s, so I guess if we are going by historical patterns we could be facing a heck of a stock market climb.

 

[Badger]

By the time the dust settles and all the negative impacts have been rectified many years will have come and gone. By then I will either be dead or too old for it to make any difference for me. Just digging out of the extraordinary amount of money that has been spent by the government is going to take a very very long time and a great deal of financial pain for everyone to recover.


Cheers!

 

[eytonxav]

This comment from the article is interesting, and while it may be true strictly in pandemic terms, I seriously doubt it will be considering the social unrest/incivility occurring in large cities:

"Businesses will want to invest, people will want to move back and the more a city is damaged, the faster its recovery will be. Keep in mind New York City's recovery after the Spanish Flu. Its population grew, as did its role as an economic and cultural center."

 

[Rianne]

This comment from the article is interesting, and while it may be true strictly in pandemic terms, I seriously doubt it will be considering the social unrest/incivility occurring in large cities:

"Businesses will want to invest, people will want to move back and the more a city is damaged, the faster its recovery will be. Keep in mind New York City's recovery after the Spanish Flu. Its population grew, as did its role as an economic and cultural center."

We've been through civil unrest, many times. The Civil War, the Great Depression, the 1960's-70's. The U.S. is a young country. Growing pains. I think it's important to learn from history. What kind of society do we want to be? I hope the majority of us will be prosperous but I'm not sure how to achieve that.

 

[VanWinkle]

The article appears to regurgitate the opinions of the pessimistic people in the world. It doesn't discuss the ability of free people to be self sustaining in the worst of times. In 10-20 years, most of us will forget it ever happened unless reminded by the media. A large portion of the population will not have lived through it due to being born after the vaccine's control. The thing that worries me the most is the reliance on government/politicians to save the day. People are working to save us from this plague, and the same people will rebuild the economy and cities after this year is gone. If you think the government paid the bills, remember where they get their money. Loaning them funds at rates well under 1% is being done by the people who hope to improve living conditions for everyone in the world. Maybe I am naive, but I call it optimism.

 

[Rianne]

The thing that worries me the most is the reliance on government/politicians to save the day. People are working to save us from this plague, and the same people will rebuild the economy and cities after this year is gone. If you think the government paid the bills, remember where they get their money. Loaning them funds at rates well under 1% is being done by the people who hope to improve living conditions for everyone in the world. Maybe I am naive, but I call it optimism.

Well said. Government/politicians have destroyed nations in the past and present. But we can't seem to agree on how to move forward. The people working to save us from this plague are also dying from this plague. And yes, my tax dollars are supporting many things I don't agree with. We're a nation of many tribes. Tribes have similar goals. My hope is to belong to a tribe that insures a better future. Which tribe provides that insurance? And how do we bring those tribes together for that common goal.

 

[Chuckanut]

People tend to have a today bias. Whatever is happening today will go on and on and on tomorrow.

Remember the time of Peak Oil. After that oil prices would go up and up as less oil was available. $100 a barrel would seem cheap. Didn't happen. I remember in the early '70s when social unrest plagued many cities. The collapse of society was coming up. Get your cabin in the woods, food supply, gold coins, guns and amo and try to survive it. Didn't happen. The Soviet Union fell, no more foreign enemies to threaten us, no more need for a powerful Army. The peace dividend would finance al sorts of improvements to the human condition. Didn't happen.

EVALUATE AND ADJUST. People have been doing that for centuries and it won't stop now.

 

[VanWinkle]

People tend to have a today bias. Whatever is happening today will go on and on and on tomorrow.

Remember the time of Peak Oil. After that oil prices would go up and up as less oil was available. $100 a barrel would seem cheap. Didn't happen. I remember in the early '70s when social unrest plagued many cities. The collapse of society was coming up. Get your cabin in the woods, food supply, gold coins, guns and amo and try to survive it. Didn't happen. The Soviet Union fell, no more foreign enemies to threaten us, no more need for a powerful Army. The peace dividend would finance al sorts of improvements to the human condition. Didn't happen.

EVALUATE AND ADJUST. People have been doing that for centuries and it won't stop now.

Good Post Chuckanut!!!

 

[oldphd]

People tend to have a today bias. Whatever is happening today will go on and on and on tomorrow.

Remember the time of Peak Oil. After that oil prices would go up and up as less oil was available. $100 a barrel would seem cheap. Didn't happen. I remember in the early '70s when social unrest plagued many cities. The collapse of society was coming up. Get your cabin in the woods, food supply, gold coins, guns and amo and try to survive it. Didn't happen. The Soviet Union fell, no more foreign enemies to threaten us, no more need for a powerful Army. The peace dividend would finance al sorts of improvements to the human condition. Didn't happen.

EVALUATE AND ADJUST. People have been doing that for centuries and it won't stop now.

Along those lines... In the early 80s with mortgage rates in the teens, I remember reading an article that said we'll NEVER see rates below 10% again...

 

[Sunset]

After the Spanish flu, we had the roaring 20s, so I guess if we are going by historical patterns we could be facing a heck of a stock market climb.

You are forgetting it was also the end of WWI.

We forgot to have a world war before covid-19

 

[eytonxav]

You are forgetting it was also the end of WWI.

We forgot to have a world war before covid-19

Yep, never underestimate the impact of a guns/butter driven economy where at the end of major world wars the US helped rebuild/resupply many other countries.

 

[atmsmshr]

My 2 cents.

- Higher unemployment from gig economy, travel and leisure industries.
- Commensurate higher poverty and crime
- Rental evictions and mortgage defaults rise
- Bad bets on real estate finally come home to roost for landlords.
- Banks suffer awhile while bankruptcies roll through the system.
- Wealth gap widens
- Health consequences for the poor without access to medical care.
- Universal Basic Income debate gets real
- Lacking spine to increase revenue or cut size of government outlays, congress continues to authorize Treasury to print more money.
- Results in US Dollar slow devaluation and increased inflation at home when the current accounts deficit becomes unsustainable or when the world stops buying US Treasuries. (Unlikely in the near term)
- No good alternative to US Dollar as a world reserve currency so inertia rules the years ahead.
- Increasing e-commerce and other FAANG companies and wannabies (well, duh)
- Distance learning option is here to stay.
- Ditto work from home option.
- Commercial real estate buyers market from more work at home results in contraction in construction industry.
- Governments crank up infrastructure construction employment programs.
- More focus on green programs and climate change mitigation projects that provide jobs. Utilities and industries with a green focus prosper.
- Higher airline and restaurant operating costs due to smaller operating scale
- Less overall driving with distance learning and work from home.
- Slowdown in the rate of increase for global carbon emissions.
- Prolonged period of low oil prices
- Petro states are unstainable in the long run until their economy revamped or revolution. Some Petro states will export instability to distract population.
- People will finally appreciate creating a strong Public Health service but bickering and incompetence within CDC and WHO means that it stays at the state and local levels.
- Some manufacturing returns closer to North America and is automated as nationalism and autarky rises.
- Global trade slows, hindering developing world pulling themselves out of poverty.
- Chinese economy slows but the communists retain power while the Indian economy will take off if their politicians get serious about reform.
- International tensions rise as politicians in economically challenged countries distract populace from real problems. Probability of war increases. - Terrorism rises.
- A successful covid-19 vaccine if novel, will herald a new era of 'designer' vaccines as revolutionary to medicine as antibiotics.

You can probably guess - I worry about all this crap.

atom