A zombie apocalypse in the making

Stock markets and oil prices in freefall. Saudi Arabia launching a crude price war against onetime ally Russiain. Virus spreading.

After 10 years of growth it seems like all the big problems hit the world at once.

And it will probably get worse before it gets better.

Like I wrote in my article COVID-19: A global crisis in the making? published on the 1st of March Federal Reserve lowered the interest rate and gues what - there was no effect. Like I said, you can't fight viruses with lower interest rates.

Trump and his policy of denial don't help. And if the virus hits US like it hit Italy, he might even lose the elections that he was sure to win. It may seems far-fetched, but it might happen, because the US response to the virus was slow and clumsy.

All the ingredients are ready for a shock unlike anything we have ever seen. First comes the supply shock because of the closed factories in China, S. Korea and Italy (other countries could follow). Then there could be a big demamd shock as people stop spending money on travel, luxuries and so on.

This is a new situation and nobody knows how it will play out. And unfortunatelly our governments and central banks have no tools left to fight it.

I'm usually an optimist, and I know we will survive and prosper in the long run. But the short run looks very dim.

Now I know that a lot of people are afraid right now (perfectly normal, I'm affraid too). But don't let fear stop you from action.

What are the current opportunities for us?

- Optimize your business if you are a business owner.

- Focus on learning new money making skills (sales, marketing, leadership) if you are an employee.

- Think about new business opportunities and ideas.

- Wait for a good time to buy stocks (index funds) when the stocks are cheap.

We will get through this. Focus on opportunities and you will be OK.

P.S. I know that I will get comments like: "This virus is just another flu, there is no reason to panic. Everythinng is perfectly OK."

Well let me get this straight: what you and I think about the virus is totally irrelevant. The fact is that when a lot of people get it, a lot of people need intensive care (app. 10%). Even if they are healthy and young. And in Italy they are already running out of resources to take care of sick people. That is why authorities need to react before it's too late. And this means less travel, less or no events, decreased productivity, ... This is driving markets down right now. And the fact that you are not worried will not change that.