On a Positive Note....
/The coronavirus outbreak has taken the world by storm. None of us can escape the 24/7 news cycle that has thrown the virus to the top of minds for every American. Global equity markets have plunged, cities are shutdown, and some are in full-on panic mode. This is the most difficult period most of us have ever seen for our society. In a moment of overwhelming pessimism, I want to offer a brief reprieve from the many things that worry us.
Please note, this article is not an economic or market related repot. (We have produced a large library of commentary dedicated to these topics and you may access that material HERE). This piece is meant to help lift spirits by reminding us all that, in the midst of so much that is negative, remarkably positive things are happening all around us.
America has Mobilized
Over the past decade, many companies have invested heavily in technology to facilitate remote working. Virtual meetings, cloud computing, virtual phone systems, companies across the country have gone remote. According to data from Gallop, more than 43% of Americans have the ability to work remotely. Social distancing and self-quarantining have rightly encouraged many companies to close down their physical offices and transition employees to work from home. Years ago, this type of self-quarantine would equal the total shut down of productivity for companies. Today, many employees working remotely are able to resume “business as usual.” To me, this is incredible.
Innovations are alive and well
“Necessity is the mother of innovation.” New technologies that have emerged in the last decade have enabled the world to respond to this outbreak quicker and more clever than ever. When a hospital in Italy realized they were going to run out of respirators, a local startup stepped up and was actually able to use a 3D printer to make new ones. In a matter of just 6 hours the company was able to mock up a design and begin manufacturing (printing them) to ultimately be used for 10 admitted patients. To me, that is incredible.
We’re closer than ever before
This might sound odd, as we all sit alone in our homes, but I believe that this whole process has brought us together. America has rallied together in a way that many have not seen in their own lifetimes. Americans now have one big thing in common, we are all quarantined, or sheltering in place, in our homes. Many of us are alone and we are quickly adjusting to this new reality. As toxic as social media can be during times of stress, recently it seems it might be returning to its original purpose, bringing people together. We’ve seen gyms begin to host virtual live workout classes. We have seen musicians host live virtual concerts. We have seen celebrity chef host live cooking classes for their audiences, the creativity is endless. America has done what we always do, we have adjusted and come together to make the best of this strange time. To me, that is incredible.
Disciplines have been tested
For the last 10 years, investing has been (generally speaking) relatively easy. We have just concluded the longest bull market that America has ever witnessed. “A rising tide raises all boats” describes the investing environment for the last 10 years. For many years of the past decade, the S&P 500 has been one of the top performing asset classes. All an investor needed to do was to own US stocks and, generally speaking, they were a genius! The last four weeks have reminded us of why we practice our core academic investment principles. Asset allocation, diversification, passive management, these principles are currently being tested and we are reminded of why we do them. Additionally, many behavioral biases are on full display among investors as well. Long term investing is a marathon, not a sprint, and we were reminded of that this year. To me, that is incredible.
The world is healing
One unexpected side-effect of the coronavirus outbreak is that the water of the canals in Venice is reportedly clearer than ever. Since the outbreak put a pause to tourism in the city, the canals have ended up without boats. There are even pictures of dolphins swimming through the waterways as a result of a lack of boats. Other parts of Italy have also reported positive side-effects of the outbreak. It has been reported that swans have been swimming in the waters of Milan. To me, that is incredible.
An end might be in sight
For the first time since the beginning of this outbreak, China reported zero new domestic cases of the coronavirus infection. On March 19th Wuhan, the Chinese town reported to be the epicenter of the outbreak, reported no new cases. The City of Wuhan has been on lockdown since January 23rd. While there is still much ground to cover, positive developments like this can give us a glimpse of hope for what is to come. To me, that is incredible.
The weeks or months that this virus end up occupying will redefine America. It will change social norms, it will change the way that we view each other, society, and the way we behave. However, we will come out of this as a better nation. Markets will eventually recover, restaurant and concert venues will again be sold out, and we will be able to congregate with our friends freely. America will always come out stronger during times of adversity. If you have any other positive stories that you come across, please do not hesitate to share.
