Time to “Cheer Up” About COVID-19?

April 8, 2020

With jobless claims at all-time highs and an uncertain date of when the economy will re-open its doors, there’s no doubt this a scary financial time.

People have lost their jobs in droves and seen large portions of their wealth evaporate overnight. If you were in the market for a house or a new car, making that kind of decision right now is especially tough. Will house prices tumble, or will foreclosures stall due to the 180-day mortgage forbearance (with an option to extend an additional 180 days)?¹

This is undoubtedly a scary financial time for everyone, and being in isolation can make it even tougher. Finding the silver lining if you or a loved one is negatively affected by the economy (or worse, the illness) is no easy task.

We can’t make everything better, but maybe these 3 positives can help put things in perspective.

There are Early Signs of a Market Recovery

Have we reached the bottom of the stock market? If so, now’s the time to scoop up stocks at a discount.

Dr. Fauci, the director of the National Institute of Allergy and Infectious Diseases, as well as the unofficial spokesperson for COVID-19, has gone on record saying that he believes the Coronavirus outbreak is about to “turn around” and hospitalizations are down.

The markets have responded with tentative recoveries, and there are still plenty of bargains to be had as we are still far from this year’s earlier highs.

However, if you do dip your toe back into the market, you might want to exercise caution. The virus is only a tiny part of the economic big picture. The fact remains that we shut down the world economy over a virus that behaves similarly to the flu. This behavior is unprecedented, and it’s impossible to predict the aftershocks.

There’s a lot of fear around the severity of the Coronavirus, and we are dealing with a lot of uncertainty. Without trying to sound insensitive, we acknowledge with a heavy heart that yes, people are dying. It’s also important to separate fact from media spin, especially when Dr. Fauci himself has shown to play both sides.

Here’s proof: Dr. Fauci said in a March 26^th paper published in the New England Journal of Medicine, “This suggests that the overall clinical consequences of Covid-19 may ultimately be more akin to those of a severe seasonal influenza (which has a case fatality rate of approximately 0.1%) or a pandemic influenza (similar to those in 1957 and 1968) rather than a disease similar to SARS or MERS.”²

Yes, you read that right. Even Dr. Fauci has compared COVID-19 to the flu and found them to be similar.

Re-opening the economy after this shutdown is not going to be like turning your car back on and putting your foot on the gas. We’ve got a long lumbering road ahead of us.

Quarterly earnings are going to be down across the board, and the market could face further corrections. Keep your eyes peeled. Look for opportunities where you see them. Your best bet is likely companies with solid fundamentals and bright futures that are discounted now, but will return to their former glory by the end of 2020.

The Stimulus Package Passed

We all know that there’s no such thing as a free lunch, but this could be close. The stimulus bill passed on March 26^th (there’s something interesting about that date!), and it calls for more than $2 trillion in relief for taxpayers and businesses.

Soon, there will be direct deposits into taxpayers’ bank accounts (assuming you claimed less than $75k on your last tax return or $150k as a household).

One of the best things to come out of the stimulus bill is that the employers who take advantage of the forgivable loans must keep their employees at full pay and hire them back by June 30^th.³

The strong dollar could protect us against inflation, or worse, stagflation, but that’s not certain. Printing money just because you can is never a good idea. Just ask Venezuela. So, the long-term effects of this plan remain to be seen. But the good news is that it should provide some immediate economic relief.

Explore New Job Opportunities

Unprecedented numbers of people are working from home, and it’s likely that many jobs that required a physical presence could shift to remote work. If you’ve wanted to get back into the workforce, you now have more opportunities than ever, now from the comfort of your home.

Are we seeing a new digital revolution? Maybe.

There are companies that are hiring (besides Walmart and Costco). The online education market is experiencing an unprecedented boom, for example.

If there’s a topic you’re passionate and knowledgeable about, sign up with outschool.com and offer a class. You set the price, use their platform, and take 70% of the proceeds. You don’t need special equipment – you could stream your class directly from a computer with a webcam and microphone.

With millions of kids (and adults) stuck and bored at home, you can teach almost anything, from art and music classes to math and phonics, and even personal development. Outschool is just one of many teaching platforms. There’s also Udemy and Teachable that are also suitable for everyone, including technophobes.

The Bottom Line: Human beings are resilient, and even though things are uncomfortable now, we are skilled at adapting to new situations. In the midst of chaos, there is always opportunity. We touched on three positives that you can take with you and make your own. Will you find a diamond in the rough to invest in? Will you or a family member have a new career as an online entrepreneur? Despite the lack of physical freedom that we are all currently experiencing, there are still ways to earn money and protect your financial future if you get creative.