By Jack Kelly
If nothing changes between the time I’m writing this (about 3:00 pm est) and when you receive our really cool, awesome and informative newsletter, the stock market has rebounded nicely since the lows hit early last Friday. As of now the Dow Jones is up over 838 points. I get that the stock market isn’t a measure of everything, but it’s a pretty handy barometer of where things are heading.
Last week going into the weekend things looked dire. Over $5 trillion of wealth was wiped out during the global collapse in stock prices. For a brief moment, it looked like the wealth inequality gap was closing as uber rich folks like Jeff Bezos and Mark Zuckerberg lost small fortunes. I know, that’s so sad.
One fortune is freely being given away. Laurene Powell, the widow of Apple founder Steve Jobs, plans to give away almost all her money—$28 billion. Powell said “I inherited my wealth from my husband, who didn’t care about the accumulation of wealth.” I find it’s always the very rich who claim it’s not about the money. I think I’d come back as a ghost and haunt my wife if she gives away everything I’ve worked for and the kids are left with nothing but a fading memory of me. Maybe Powell’s kids won’t mind missing out on $28 billion. She claims that “I’m not interested in legacy wealth buildings, and my children know that. If I live long enough, it ends with me.” I have a hunch that her children will cryo-freeze her so sticks around for a long time.
All we heard on television over the weekend was how bad the Coronavirus is and we’re heading into a zombie movie apocalypse of infected people. The change in sentiment today feels like the worries were overblown. Yes, there will be pain from China and other countries shutting down or curtailing operations. This will adversely impact the United States. But it’s not the end of the world. Things will probably be bumpy for a while but we will get through it like we always do.
Two people aren’t getting through, though. I’m not referring to the outbreak but politics. Mayor Pete, Senator Amy Klobuchar and hedge fund billionaire and aspiring hip-hop artist Tom Steyer are all dropping out of the Democratic race to become president. Mayor Peter will probably get a gig on CNN sitting next to Andrew Yang, Klobuchar will continue doing her senator thing and I don’t think anyone really cares what Tom will do next.
As I wrote today in Forbes.com, over time there will be remedies found to counteract the outbreak. People will still die but others will be saved. Once the tide turns, the overall mood will sharply pivot from fear to relief. International trade will pick-up. Companies will rehire people to deal with the improved market conditions.
Our eyes have been opened to some of the unpleasant activities that exist in China including their authoritarian orientation, human rights violations and flagrant disregard of health and sanitary conditions. This is in addition to our prior concerns over China’s alleged theft of intellectual property and demands that U.S. corporations must enter into onerous one-sided deals with Chinese-owned companies to conduct business in their country.
The Coronavirus will signal the end of China’s dominance as the manufacturing epicenter of the world. How could a company keep employees in China with all we now know? Any company executive who cares about their employees’ safety, human rights and the environment will elect to pull out of China and relocate their business back to the U.S. or to other countries.
This will be great news for Americans. While it’s naive to believe that manufacturing will return to our 1950’s heyday, it’s reasonable that we will see some increases in this sector. We will also be less dependent upon and at the mercy of China for a majority of our goods, especially essential ones such as pharmaceuticals.
This may be wishful thinking, but disasters bring us together. Perhaps this situation may unite us with a common goal of defeating this outbreak, preparing for a smarter approach towards international trade and ensuring better systems to help with our medical care and health issues.
Sometimes it takes a disaster to make us stop taking things for granted and pushes us towards collaborating on improving things for ourselves and future generations.