Just as the European Union was confronting the ugly reality of Covid-19 infections forcing countries to go into lockdowns and the US still dealing with the Delta variant threatening to take the steam out of the economy going into the holiday season, South Africa raised the alarm on Friday over a fast-spreading strain of the coronavirus. The World Health Organization called the new Omicron strain a “variant of concern” that could be more transmissible than other strains of the virus. With much of the world still unvaccinated, health experts are worried their fears may soon be realized—that the virus will evolve into ever-more transmissible, possibly more dangerous forms that could circumvent existing shots.
The Dow Jones average fell more than 900 points, or 2.5% on Friday, for its worst day of the year, while the S&P 500 slumped 2.3% and the Nasdaq Composite slid 2.2%.
Future Wealth’s View
It is almost inappropriate to say “I told you so” in these circumstances, but we had cautioned investors in our report on Oct 3rd, 2021 stating that “Covid is not going to disappear – not in 2021 and not in 2022 either”. The mistake we made is that we had projected that the next variant after ‘Delta’ will be named ”Gamma”. But the WHO (World Health Organization), which has botched the containment of the virus from the beginning and have instead given the Chinese a free pass for creating and spreading the pandemic, chose to name it “Omicron” instead. The link to the article is here – https://futurewealthllc.com/
The question is – what do we do now? We, at Future Wealth, would recommend that this is the time to pick up and read a book on long term investing. While it is true that Delta and Omicron are going to cause some near term damage on one’s portfolio, it is important to remember what grandma said – “This too will pass”. Just as we survived the initial assault of Covid in Feb 2020 on our portfolios and moved on, we will eventually get past the new variants as well. It is critical to not react to every bit of bad news and stock market movement in these testing times. Those who do, will wish they had done otherwise a few years from now. Don’t be one of them.