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Notices
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John (not verified)
18th June 2020 | 9:29am

I found your article because I searched for political bias in financial news. (Confirmation bias right?) An author was writing about the illegitimate rise in the stock market since the fall in March. That unemployment and Fed stimulus and risky amateurs were reason to believe it has been a false rally. And it should all come crashing down soon.
I've been doing a lot of thought on this as well. Does the weekend destroy our economy or investments? Just two days out of the week? No. It's a "pause" in the process. We shut down on Friday and resume on Monday. If we recorded it on a cassette recorder stopping on Friday and starting back on Monday, but played it back after a year, the recording would not have gaps, it would be a continuous stream. What about holiday break till New year's? A week where most of us gap our financial lives. When we get back to work on New year's day, we pick back up where we left off a week ago. No catastrophies. No casualties.
My opinion of the coronavirus gap is the same. We've lost the potential to make money but have we lost real wealth? Maybe we have lost a little as the market is not completely back to its high (which was pretty high anyway)
A Coronovirus gap, in my opinion should be no different than a weekend gap or a long holiday gap in productivity/income. The length of time is absurdly beyond a mere few days. But conceptually it's no different. The system free fell because if a physical virus not a financial problem. The elephant in the room is just passing through (breaking a few dishes along the way). As the virus passes through time we will put our boots back on and go back to work. I will want to consume pretty much the same things I wanted to consume last December. I'll want to go and do all the same things I did every other year. I'll spend and invest pretty much the same as I always did. Those services and their production will get back to where they were.
In summary, loss of income is not loss of wealth. I'm not saying it's not painful I'm only saying it's a gap. And if you can survive the gap, the other side will not be much different than before.