After opening fifteen hundred points down, the stock market dropped another two thousand. Consumer goods are up 20% — hoarding toilet paper does some good after all — but the rest of the market is through the floor.
Coronavirus fears, a massive price war for oil, and a certainty among financial wonks that a downturn is due: All these come together to create a truly nasty couple of days, and likely a few more after that. After all, there’s no great likelihood that this minor plague will burn itself out in even a month, and long before then we’ll be noticing a fairly permanent impact on local businesses.
But economies are robust things, and any shopping not done locally will certainly take place on a larger level. Amazon will do quite well out of this, as will InstaCart and other grocery delivery services. Hospitals will make out, as will medical supply companies. And those who get sick soonest will be out and about long before the rest of the people hiding behind doors — well, most of them. 96% or so, give or take.
In the end, a lot of people are going to die, and that’s tragic but unavoidable. Those who take reasonable precautions will do better, and those who don’t, won’t. And the economy will continue along just fine, because it’s all too big to fail.
But now is not a good time to run a small business, or work conventions, or rely on tourism, or even work in a restaurant. The chaos that’s coming for these people is going to be seriously unpleasant, and a responsible government would be talking about Universal Basic Income right now — specifically for everyone who’s temporarily out of work because of this mess. Will that happen? Hard to say, but somehow I doubt it.
Some of you are no doubt wondering why I’ve led this off with “Fear and Loathing”; generally, I reserve that for the elections. As it happens, this is about the elections; never fret. After all, elections are won and lost on the economy: Just ask George Senior, who presided over a quick-won war, the rise of the Dot Com stocks, and the fall of the Berlin Wall and collapse of communism — and then got voted out because of the mildest downturn in a century of cyclic boom-and-bust.
I can’t tell you exactly how this will impact the election; there’s too many variables for that, most of them people. If Trump acts wisely (or luckily; same thing in the end), this could burn itself out well before November and we’ll be back on our way to record numbers on the Dow average. If the virus burns itself out early, same thing — and it’s likely to; with the primaries and voting, there’s no way to prevent its spread and, considering the chances this will mutate down to a mild cough before long, little reason to.
But what I can tell you, and this for certain: If it’s managed well, Trump will get the credit — and he’ll deserve it. If it’s not, he’ll get the blame — whether he deserves it or not, which in my opinion will balance out a lot of scales. In any event, it little matters now whether Bernie or Uncle Joe gets the nod. That won’t matter all that much.