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The Pandemic & Economic Situation: Five Things to Know & Five Things You Can Do

Apr 13, 2020

 One of the guiding principles explored in the Contemplative Studies Program is that we have agency. In the face of adversity we can become empowered to consciously direct our evolution towards more favourable outcomes.

What follows is an instalment in a series of assignments taken on by CSP members. Students were asked to research pandemic related subjects including economics, health and lifestyle. The purpose of the task was to engage critical reasoning in the midst of a barrage of sensational headlines and form an action plan. In a crisis, having a plan and keeping moving is critical to mental health.

This information is provided to deliver you things you should know, and things can do during the pandemic.


During the past four weeks we have experienced the impact of the effects of the Global Pandemic infecting almost two million people, and over 100,000 deaths.  In the U.S. there are over 500,000 people infected with over 21,000 deaths. On March 16th the stock market experienced the worst day in stock market history, and on March 24th experienced the best day since the Great Depression. 

Five Things to know

  1. There is much uncertainty in the economy.  The CBOE Volatility Index, the VIX, also known as the fear index, surged from 13 in February to a record high of 82 in March, and settled back down to 41 this week.  The VIX tracks the 30-day implied volatility of the S&P 500. There is more than a perception of uncertainty in the financial markets.
  2. The global pandemic has turned into the 2020 COVID-19 financial crisis. The bull market is over, we are now in a bear market.  The Federal Reserve slashed interest rates to zero, and the stock market still lost 20%.
  3. Sixteen million people filed for unemployment this month, equivalent to about 10% of the U.S. workforce.  Will the $2 trillion economic rescue plan trickle down to those people, or end up going to the largest corporations, including some that do not pay taxes?  There is also an additional $250 billion small business program. Businesses that qualify including those owned by the largest private equity companies, and even the President’s hotels, individually, are eligible for that assistance.
  4. Stay healthy. Mitigating the health crisis remains the first priority.  Stocks may have rebounded on hopes the virus is slowing. Earnings for the S&P 500 companies are expected to fall between 10% this quarter and as much as 40% for this year, hiring will be slow.
  5. Stay calm. We have no idea how long this will all last. The Minneapolis Federal Reserve President expects that the economic recovery will be a long, hard road, barring a healthcare miracle. 

Five Things You Can Do

  1. Don’t panic.  We are all in different financial situations.  Some of us are employed, self-employed, unemployed and some retired.  Now is a good time to organize your personal finances, monthly budgets, financial commitments, and emergency fund.  If you do not have a will and health proxy, use an online package like Nolo’s Quicken Willmaker. Make sure all of your financial accounts and benefits have proper beneficiaries for yourself, as well as family members. Five Wishes Advance Directive is the first living will that talks about your personal, emotional and spiritual needs as well as your  medical wishes.
  2. Cash flow: be prudent with your savings and spending.  If your source of income is directly impacted, examine alternative sources.  How long can you work from home with your current expenses, and consider how to reduce your expenses.  Now is not the time to go on a spending spree to reduce stress.
  3. Businesses have closed and industries are shut down.  The layoffs will impact you and your customers and clients.  If you should lose your job be prepared for a lengthy job search in a tough market.
  4. Cash is good to hold.  The stock market is volatile and now down almost 20%, after going up 25% during the last three weeks.  It might go down much more from here and it may be a while before it comes back. Don’t do anything unless you have to.  Be patient, the time you have to invest is your friend. The longer you are invested, the longer your money can compound in value. 
  5. We do not know how long this will last, typically a recession lasts 12-24 months.  This time it may be different, the new economy will be different. The good news is that there will be plenty of opportunities to invest in after the shakeout.  
Written by:

Stew Cohon

Ziya Danishmend

Carrie Goldberg

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