No Thanos Snap Will Bring the Economy Back (Plague, Day 34, April 6, 2020)

In The Avengers: Infinity War, Thanos, the super villain, is on the search for six infinity stones to fit into a special shiny glove. Once all the stones are in place, he snaps. Instantly, he turns half the population into ashes in the breeze.

The good guys spin their wheels for five years, until they come up with a plan to reverse history. In the next movie, The Avengers: End Game, Iron Man gets control of Thanos’s glove and snaps again. Though he destroys himself in the process, he brings back his dusty friends and everybody else.

Things aren’t totally back to normal, because half the population is five years older and the other half had a nice nap, but life carries on somewhat normally.

We in the midst of a slow motion Thanos snap. People are dying. 10 million people are suddenly unemployed. Entire sectors of the economy and social life have ground to a halt. From education to tourism to entertainment, life has changed so drastically that people haven’t wrapped their brains around this fact.

And some people say this situation could carry on for 18 months. We could go in and out of seclusion for months, as we wait for a vaccine.

And every week that we spend in our homes — trimming our own hair and growing zucchini in the backyard — we are building new habits. People are gaining new skills right now. They are learning how to cook and remembering how to clean their shower. Especially if they’ve had some financial hits, they are going to be very, very slow to spend money on housecleaners and restaurants in the future.

Some entrepreneurs are going to do very well with all of this. Never forget that early adopters always rule the Internet. So, people who move quickly will win. What kinds of industries and skills are going to be hot now? Online only businesses, anything in pharmacy or medicine, private online education companies. Professions in finance and law seem stable right now. The hot skills are social media, programming, communications, lifestyle gurus.

We’ll be okay, I’m sure of it. There will be some adjustments, of course. But we’ll adapt.

32 thoughts on “No Thanos Snap Will Bring the Economy Back (Plague, Day 34, April 6, 2020)

  1. Yes, we’ll adapt, but i think there are many people who will realize that they hate cutting their own hair, cleaning their own houses, cooking their own food, working the same house as their families, meeting people on zoom, . . . .

    I expect to do a lot more going out after this is over than I did before. I have friends who are posting how much they miss being able to work in their offices (true for my spouse, who definitely prefers working in his space separated from the house, even though he has a home office perfectly equipped to do the work and mostly works with people across the country).

    I do not think this lifestyle can be sustained for 18 months because I think there would be breakdowns in essential services over that period of time (i.e. food, maintenance of dwellings, health care, . . . .). I think we’d eventually have to start recruiting others to staff the grocery stores (i.e. that people with managerial jobs currently being paid, school teachers, etc. who are making things work with zoom/people paying even if they aren’t working, home health care, cleaners, . . .).

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    1. Also, lots of people won’t be able to travel, go to restaurants and salons, hire house cleaners, because they don’t have jobs and can’t afford those extras.

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    2. Anonymous said, “Yes, we’ll adapt, but i think there are many people who will realize that they hate cutting their own hair, cleaning their own houses, cooking their own food, working the same house as their families, meeting people on zoom, . . . ”

      Yep. As soon as it is prudent to do so, I am going to do All the Things.

      “I do not think this lifestyle can be sustained for 18 months because I think there would be breakdowns in essential services over that period of time (i.e. food, maintenance of dwellings, health care, . . . .)”

      Yep.

      As basically healthy people, we’re putting off a lot of basic healthcare needs right now. There’s only so long you can put basic health maintenance off without damage–and that goes 10X for people with more substantial health needs. Even just the delays in dental care alone are potentially dangerous and damaging.

      I just called a foundation company because the tile in our front entry is starting to (eek!) bubble up and creak. I was very happy to discover that foundation issues are considered “essential services” and we can go forward with an estimate, but not every local government is going to have policies that are rational and sustainable long term. Consider, for example, the no paddle-boarding on an empty beach policy or no using playgrounds even when your family is the only one there. There’s no way that the public will tolerate that stuff long term. Furthermore, the police cannot be everywhere and cannot control the public if the public decides that it has had enough. The public has to be onboard or all of this collapses.

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      1. There will be *some* people who continue with this lifestyle out of choice, but *most* won’t have any choices. They won’t have jobs or income. The virus will keep making people sick and the government will keep us in our homes. This isn’t going away. I don’t even think Jonah will have college this fall. I don’t think many of his friends will ever go back to college.

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      2. There r now $1,000 fines for not social distancing in NYC. You know why? Because they are stacking up the bodies in refrigerated trucks outside hospitals.

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      3. The IHME model at the UW has Washington having reached its peak usage of resources, on April 2. I fervently hope it is correct and that we are moving forward

        The IHME model is being criticized at the WP, and I am also concerned, as wel because the model seems to be very sensitive to the initial death counts,
        https://www.washingtonpost.com/health/2020/04/06/americas-most-influential-coronavirus-model-just-revised-its-estimates-downward-not-every-model-agrees/

        The previous iteration had WA reaching its peak on April 11, with just a few shortages. The change to April 2 doesn’t make the model wrong — we have been implementing stronger and stronger distancing measures. But, it is a big switch. Fortunately, we will see the data as it comes in.

        Gabriel Leung talks about “hit and releasing” the breaks in his NYT opinion pieces: https://www.nytimes.com/2020/04/06/opinion/coronavirus-end-social-distancing.html

        He seems a bit overly hopeful of uses of invasive telephone/facebook/etc. data to watch carefully as we decrease restrictions, but, there will need to be a way forward.

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      4. bj said,

        “The IHME model at the UW has Washington having reached its peak usage of resources, on April 2.”

        Very good!

        You WA guys have been doing this so much longer than the rest of us, though.

        “He seems a bit overly hopeful of uses of invasive telephone/facebook/etc. data to watch carefully as we decrease restrictions, but, there will need to be a way forward.”

        Right. Especially as the US is a very large country and different regions are operating on different timetables.

        Back on March 24, Razib Khan tweeted, “i think USA has to figure out a way to shut down non-essential interstate travel. perhaps even more granular. likely there will be heterogeneity in scale of the impact of the pandemic. that way some areas could come back ‘online’ faster to support the ‘hot zones’ in lockdown.” He’s got that up as a sticky tweet now.

        On the one hand, this feels really bad and weird. On the other hand, it’s actually less intrusive than a universal neighborhood lockdown. As other people have pointed out, lockdowns are just really extreme travel bans.

        I would like to see domestic air travel kept down as much as possible until the epidemic is “solved.”

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      5. The local news said that the mortuaries in the hospitals are full, so they stacking the bodies. The news also said they might start burying the bodies in public parks temporarily. IDK. Could be a funeral home thing.

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      6. Right now, at (hopefully) the peak, you’re seeing 600 COVID deaths a day in NYC, which must average about 300 per day in normal times (8 million people with lifespans of 67 years). Deaths from other causes are probably down, but you can still see that the system would be temporarily overburdened.

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      7. On stacking bodies,

        https://gothamist.com/news/surge-number-new-yorkers-dying-home-officials-suspect-undercount-covid-19-related-deaths

        Statistics from the Fire Department, which runs EMS, confirm a staggering rise in deaths occurring at the scene before first responders can transport a person to a hospital for care.

        The FDNY says it responded to 2,192 cases of deaths at home between March 20th and April 5th, or about 130 a day, an almost 400 percent increase from the same time period last year. (In 2019, there were just 453 cardiac arrest calls where a patient died, according to the FDNY.)

        So the count of the COVID-19 death toll probably underestimates the actual death toll. A 400% increase of unattended deaths is noticeable. I thought that unattended deaths have to have an autopsy to rule out foul play? In which case, there are many bodies that would be stored as a matter of course, before a coroner can check on them?

        And hospital mortuaries aren’t the same thing as city morgues, are they? It’s very unusual to have so many patients in the ICU, seriously ill, at the same time. Hospitals are turning other units over to COVID-19 ICU care, which means there are more deaths at the hospital than usual.

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  2. That was me, above.

    I think how the economy changes will depend on what people aren’t willing to pay for anymore, and shop front retail comes to mind as a big potential casualty. Stores were already struggling, and I can see more of them closing shopfronts. Then what? what happens to our malls, shopping centers, . . . . which were places to gather without cover costs (like restaurants and bars and concerts)?

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    1. Have realized how much none of those places are where I like to hang out. Kid actually complained that she HATES the outdoors the other day (it has something to do with allergies, but was also funny). No she is not 13.

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    2. Our parks, playgrounds, playfields, parking lots at parks are all closed. I see NJ closed its state and county parks today. My last visit to a local park was 3/21; last visit for fun to a shop to buy flowers 3/25. Otherwise, I’ve been outside on our sidewalks. It’s a pretty neighborhood, but its definitely getting old.

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      1. It’s ten million unemployment claims. The numbers for the unemployed are going to be much higher because some people were ready not employed and some can’t file a claim.

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      2. The stock market looks forward, not at the current employment situation. (In a normal recession, the market starts rising well before the employment figures improve, which is why it is part of the index of leading economic indicators.) And today, it likes the future it sees.

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    1. Hah, Calvin Klein, Michael Kors, Nordstrom’s, Kohl’s, ULTA, MGM Resorts, Royal Caribbean, Carnival Corp. Norwegian, Marriott, Boing.

      I’m thinking people trying to make short term gains, and not holding for the long term recovery.

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      1. Me, too. Steve’s job isn’t in jeopardy, but he probably won’t get a bonus this year. We were going to use last year’s bonus to help pay for a summer vacation to Italy (!) and new siding on the house. Thank God, I didn’t buy the tickets or sign up a contractor a couple of weeks ago.

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      2. Tulip said, “I’m not spending on any extras except the yard/garden right now”

        I tried to do my usual monthly Landsend order a couple days ago. I didn’t manage to put together an order, because it turned out that there was nothing we needed. The kids don’t need new school uniforms, husband doesn’t need new dress shirts, etc.

        I did buy a Keep Calm and Carry On t-shirt (arriving in June) to join my Just Keep Swimming t-shirts and some odds and ends on Amazon today, and the 9th grader needs some new shorts for running, but there’s not much else we need in terms of clothes. The kids and my husband have huge wardrobes of t-shirts and there’s probably going to be no 2020 prom. I haven’t deleted my Amazon prom dress ideas, but that’s a long shot. It’s very unlikely that I will spend this month’s clothing budget on clothes, just like it’s very unlikely that we’re going to spend our gas budget on gas.

        We have bought a bunch of books, craft kits, small athletic equipment and weird quarantine survival stuff like clippers (for home haircuts for the guys) and 3D printer filament.

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  3. We’re also going to know soon (or soonish) how many people in various areas have already had COVID-19.

    Once we know that for different areas, we can start making more informed choices about opening up/keeping closed down.

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  4. “ We’re also going to know soon (or soonish) how many people in various areas have already had COVID-19.”

    I am a lot less sure that widespread antibody testing is really on the horizon.

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    1. More generally, all of the biotech solutions that are being touted as a solution to life gets back to normal (economically, particularly) will come (I used to be more pessimistic, but the AIDS advances significantly advanced my belief in the miracles of modern medicine), but not necessarily quickly. We do need rapid testing, treatments, antibody titers, and a vaccine. But, biology is messy and needs to be tested. Disruption business models (try things and fail quickly) are dangerous in medicine. There is really risk of doing more harm than good even with things that seem like they couldn’t do any harm (like testing everyone — which fails mathematically, even with excellent tests, when incident rates are low).

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  5. I was just reading an excellent point by J.D. Vance.

    He points out that no matter what we do in the US, we live in a globalized economy and the rest of the world is suffering. Even if COVID-19 didn’t exist in the US itself, the impact of COVID-19 on the rest of the globe would still cause significant economic distress.

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