A Yale professor who has studied pandemics believes the end of this one is not yet nigh. "Given what we can learn from history," Dr. Nicholas A. Christakis warns, "I don’t think people should just imagine that we’re going to rapidly and easily return to normal.”
Even if we achieve herd immunity this year, the good times won’t roll.
If you look all the preceding centuries of epidemics, then it’s clear that we’re going to have an intermediate period in which we come to terms with the pandemic’s psychological, social, and economic toll. I think that will last through 2023, approximately. We need to recover from the terrible shock of this experience. Millions of businesses have closed. Millions of Americans are out of work. Millions of children have missed significant amounts of school. Millions of people have lost family members to the virus. Many will have chronic disabilities from contracting it. We need to come to terms with all of these things, which will take time.Christakis expects that "sometime in 2024 — the timing isn’t precise — we’ll enter the post-pandemic period. And I think that’s going to feel a little like the Roaring Twenties in the last century.”
If so, all investment managers and financial advisers have to do is help wealthholders survive another two years or so. Then, party on!
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Over a century ago, at the start of 1920, nobody expected good times ahead. Bodies were still being brought home from European battlefields, the Russian revolution was creating a Red Scare, and the Spanish Flu pandemic wasn't quite over. "Normal," pre-war times seemed gone forever.
For added gloom there was the 1920s' venture into social engineering: Prohibition. By the beginning of 1921, the news was peppered with accounts of bootleggers and rum runners. Pharmacists were reported to be adding quinine or salicylic acid to toilet waters and hair tonics to discourage the drinking of "cosmetic cocktails."
I don't see how stocks could go much higher, the current P/Es are not sustainable.
Also, governments are going to be very slow in relaxing restrictions.
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