While everything from deserted ball games to school closings to elbow shakes instead of handshakes may seem strange to us, this is not the first time epidemics have wreaked havoc in America. Headlines in NY Times on April 12, 1955 was “Polio is Conquered.” Until then, polio came like clockwork every summer killing thousands and crippling many more. Finally, Jonas Salk discovered the vaccine and within a single generation, polio was eradicated in the US.
New vaccines followed for mumps, measles, rubella, diphtheria and antibiotics like penicillin and streptomycin to treat infections. Very quickly Americans saw a precipitous decline in infectious diseases and huge increase in lifetime expectancy. Other diseases like smallpox, typhoid, tuberculosis, malaria came and went and so did yellow fever, ebola, SARs and even AIDs. Pretty soon, nothing seemed beyond reach of the laboratory to heal or prevent. Until now.
And the destruction has been immediate. Stock markets across the world collapsed, US and global economies were sent into recession in a matter of weeks and anxiety has quickly turned into fear. People are staying home, kids are going crazy with no school, businesses are struggling with drop in productivity. Still, there is no vaccine in sight.
“Hey, Teacher, Leave those Kids Alone” is a line from the seminal song from Pink Floyd’s “Another Brick in the Wall”. Who would have thought that there would be a day, week or month that it would actually happen across the entire United States.
Future Wealth’s View
While we had expected things to get worse and had stated as such in our article just few weeks ago (link is here – https://futurewealthllc.com/
But yet, here we are – in the space of a month, US has gone from a country on solid economic footing to tipping into a recession that could take the next 6-12 months to get out of. In the meantime, the stock market has wiped out most of 2019 gains and there is more to come. Recovery from this setback is going to take a while – there is no sugar coating the truth.
A vaccine will emerge at some point and until then things are going to get worse. As we stated previous articles, we exited major positions in our clients investments at the first sign of trouble in early Feb and as such, the losses in our clients portfolios have been nowhere close to the precipitous declines in the major indices but this is not the time to gloat.
One prediction we will make and have reasonable confidence that could happen in the near future – Warren Buffett will make an appearance soon with a major acquisition. He always seems to show up when US Corporations are caught with their pants down.