We live in unprecedented times, as the social, political, and financial fallout from the COVID-19 coronavirus pandemic continues to evolve. The 2nd, 3rd, etc tier effects of both the virus and our various responses to it will ripple through our lives for some time to come. However, within every challenge lies opportunity, and at OmniStar Financial we’re choosing to view to current situation through that lens.
So wherein lies the next round of opportunity in this? After weeks and weeks of lockdowns, quarantines, and business closures both the federal and state governments of the US are gradually permitting businesses and public spaces to re-open. This business re-engagement unlocks the door for many potential opportunities for savvy and level-headed investors. Many questions need to be addressed, however, as you plan your next move. Under what market conditions are the reopening taking place? What shape will reopening ultimately take? How will various businesses and industries change in response? And finally—what is the best set of moves for the individual investor?
It’s important to hold in mind reopening is a nascent process. While there are plans in place, they are subject to change as the situation is both fluid and evolving. Generally speaking, most reopening plans look something like this, the three-phase plan outlined by the White House. Individual state progress through each phase as they reach certain benchmarks for transmission and recovery. While more detail is available on the White House website, here’s a summary:
- Phase One: Vulnerable people continue to shelter in place, gatherings limited to 10 persons or fewer, social distancing in place in public, travel kept to a minimum, workplaces emphasize telework where possible and reopen in stages. Schools and large venues (including bars and restaurants) remain closed.
- Phase Two: Vulnerable people remain at home, while their family members take precautions when in public. Nonessential travel resumes. While gatherings of up to 50 people are permitted, social distancing remains in place. Workplaces continue to focus on telework where possible and sanitation/sterilization where necessary. Schools and other youth activities may reopen. Bars, restaurants, and large venues may reopen with appropriate distancing in place.
- Phase Three: Vulnerable individuals may resume public interactions, with appropriate cautions and distancing. Everyone should consider minimizing time in crowded environments. Bars, restaurants, and large venues may continue to operate with increased capacity and fewer distancing protocols.
As this summary indicates, this is not an immediate return to pre-pandemic normal but a structured and perhaps lengthy series of steps to recovery and reopening. This has both personal and financial ramifications, particularly in this volatile situation. Currently, US data indicates a mixed bag—with job loss reports soaring to never-before-seen heights and many consumers insistent it’s too soon to re-open in full, confidence in the market is shaky at best and that may affect the short to medium-term outlook.
However, there is good news on the horizon, and in that, we may find opportunity aplenty for the judicious and prudent investor. Oil prices are beginning to stabilize and move in a more positive direction as the market regains equilibrium, generally an indicator of a positive economic outlook. While this may have far-reaching and positive effects, it is reinforced by the removal of another major financial uncertainty: US-China relations. The two nations clashed frequently in part as a result of the COVID-19 pandemic. However, with representatives from both sides working to reduce tensions and resume positive economic activity, we’re seeing a rise in US futures trading and a bit more optimism among markets and investors. These bode well for both recoveries and for the chances they represent to both businesses and individuals in these challenging and often confusing times.
Moving forward, we strongly suggest investors proceed with a level head and a clear plan. As we’ve said through the current circumstances now is not the time for emotional thinking, snap judgment, or overreaction. Careful planning, consideration, and good execution will win the day if we can all maintain a flexible and sensible mindset. At OmniStar Financial, we’re here to help you with just that—finding the right responses to tumultuous circumstances as the situation develops. We pride ourselves on illuminating the blind spots in the investing world, one client at a time. Get in touch today and we’ll discuss your financial future both in the immediate and long terms.
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