Future of economy uncertain amid pandemic
MISHAWAKA, Ind. --- The economic impact of the global pandemic is hitting hard, but experts advised that it is important to be cautious of more than just the outbreak to predict the future of the U.S. economy.
Most people will be at home at least through the end of April—some are working from home and others are out of work.
As the economy is wavering, most people will feel the financial burden of the outbreak.
“The reality is that nobody knows how bad it’s going to get, but there’s no question that it’s going to get worse,” Casey Weade said, President of Howard Bailey.
Experts on Wall Street say the impact of the pandemic on the economy could be worse than the impact of the Great Depression.
“At the same time they’re saying this could be a very quick rebound,” Weade said.
Therefore, the economy could quickly snap back.
Several factors come into play and the unknown is the dangerous part of the current market, according to Weade.
“It’s these compounding effects that occur in the stock market, in the economy, that I think we need to be cautious of,” Weade said.
The compounding effects mean that it is necessary to take a look at history for the big picture, according to Weade.
“We saw the financial crisis; we saw the housing bubble pop,” Weade said. Nobody predicted the Lehman Brothers would go under there shortly thereafter. If we just look at the coronavirus pandemic in a bubble, then we could say ‘Yes, this is going to be a quick drop with a very quick recovery.’”
Weade said that people have to be cautious of the unforeseen. The personal impact of the pandemic is going to depend on individual circumstances, such as age or field of work. Now is the time to get creative, according to Weade.
“There are pockets of opportunity in this market and in your own personal financial life that will allow you to come out better than ever once we get through this and we will get through this,” Weade said.
The good news is that those getting hit the hardest—such as small businesses—are now eligible to receive federal financial support since the stimulus relief package has been passed.
“The last thing you need to do is go ‘Hey, you know what, I’m going to be good for a couple more months, so we’ll just wait and see,” Weade said. “You need to do the hard work today in case this lasts longer than expected.”
The stimulus plan is only going to go so far and the U.S. economy will look much different on the back end of the pandemic, but there is no way to predict exactly what will happen in the long run, according to Weade.
“But if we looked at the coronavirus pandemic in a vacuum, then yes,” Weade said. “We should see a quick drop of the market and we could have a quick recovery by the end of the year, assuming that they are able to get some solutions in place.”
Depending on how the economy plays out, the economic impact could continue for a year or two, according to Weade.
Weade emphasized the need for positivity and encouraged people to look for areas of opportunity until the pandemic is under control.