COVID-19’S Financial Impact

COVID-19’S impact on individuals, communities, and organizations is rapidly evolving. A recent Deloitte Insights article posited four different scenarios for the global economy resulting from COVID-19, which ranged from a mild and temporary hit to the worst-case scenario, a global financial crisis. Unfortunately, COVID-19 arrived when the global economy was already showing signs of a slowdown.

In addition to the effects on the supply and demand side, COVID-19 has already jolted financial markets. Since February 21, 2020, bond yields, oil, and equity prices have sharply fallen, and trillions of dollars, across almost all asset classes, have sought safety. In the United States, 10-year bond yields have tumbled below 0.5 percent and equity prices on major stock indices around the world have fallen. It appears, as of now, that the markets are trying to price using the worst-case scenario, which has increased volatility recently. The US economy is at a crossroads and will require vision and insight from the Government and regulators to navigate its way out of a perfect financial storm. The Global Economy will also have to intelligently create a better nuanced dialogue with China to develop a more sustainable approach around trade and monetary policies. That doesn't mean the acceptance of the "China Wolf Warrior Policy" , rather a more quiet diplomatic firm approach that is a win ,win for all. Playing out every insult , jibe and drama on the front pages of evey news organisation and media , doesn't help anyone.

The human and business impact of the COVID-19 pandemic continues to unfold globally. The rapid pace at which the pandemic is spreading and the global actions taken to curtail it are having an unprecedented impact on the way we live and do business. While it is too early to fully understand the long-term effect of these events, financial institutions across the banking and capital markets, insurance and asset management sectors must prepare for the TP impact of the 'new normal'. There are many Global challenges in the Banking , financial Industry and markets. However there are also just as many rewarding creative opportunities and solutions. This is a great time to re-evaluate the way the Global Banking and Finance business model is managed , a "Reset Button" to develop , create a more modern manageable Financial System that is flexible , intelligent , highly creative and more fluid. Including the way costs , fees , insurances , underwriting , investments , trade , equity markets , bonds and so on are implemented and managed. Seeking out new horizons with long term vision with long term future security across all sectors of sustainable business models , also collaboratively working with business , clients and customers to forge strong alliances to successful creative financial secure outcomes and markets. Covid19 has changed the business world forever , we can no longer do business as usual , the need for change is here and the smart intelligent operators have already evaluated the impact and will come into their own quickly Decentralised Finance , this will be a big trend in 2021 that will allow businesses to acquire capital easier than through traditional channels. All costs , fees and insurances , loan bond guarantees , mortgages , underwriting etc , will wrapped into the loan schedule making a business loan , investment or venture loan more tidy and a more flexible arrangement. Coupled together with a solid loan issuance package against any default. ( This facility should be across all the Banking and Finance Sectors , just makes common sense and should of been implemented years ago). Decentralised Finance Companies are already moving towards this model.

There are sectors of the Global Economy that will come into their own as the new investment portfolio in 2021 and beyond. Food security - Agriculture , Mining Resource Sector , Cyber Security , Technology and Health, E-commerce Distribution Platform for Small Businesses, Consultation for Retail and Distribution Businesses, International Trade Consulting Firm , Personal CyberSecurity Software , Small Business Cybersecurity Software. There are Global challengers , however the opportunities are immense and very rewarding. It will take a collaboration of minds and forging partnerships across multiple sectors. This is all achievable with a more flexible well managed Banking and Finance system adapting to a new Global dynamic that has changed the face of business forever, nothing will ever be the same again , regardless of a vaccine.

Mark Withnell AgrilinX International Pty Ltd