Points of View
Rossoff & Company’s Points of View is a forum for industry experts, leading finance professionals and senior Rossoff & Co. professionals to provide insights and commentary on current news stories, financial market themes and industry dynamics.
MYSTERIES OF COVID 19
Like many New Yorkers, I’ve been in self-quarantine with part of my extended family (wife, son, pregnant daughter-in-law, two grandchildren and adult daughter) for almost five weeks. We are at our house on Long Island where we work in our makeshift offices, cook, clean and babysit. No outsiders are allowed in the residence; we make trips to the farm stand, grocery and wine store twice a week, swathed in facemasks and rubber gloves and equipped with disinfecting wipes. Just another American family in the spring of 2020. We’ve adjusted, but there are many things that mystify us. Here are a few of them.
Why is there no bread on the shelves?
Toilet paper, paper towels, disinfecting wipes, even milk we can understand. But what’s with the bread? And there’s no flour either. Has isolation incited a rage for sandwich making? And why can’t we find flour? No one baked before. Does anyone even know how to bake?
Now we are supposed to wear masks, before we were told not to.
Wearing masks seems pretty sensible when you’re fighting an airborne virus. And we know that Asians wear them quite regularly. So, why did our geniuses tell us not to wear them? Not invented here? They didn’t think of it? It’s not a perfect solution and it’s not in the rule book? Usual bureaucratic incompetence.
What happened to Jennifer Haller?
Don’t know the name? Jennifer Haller was the Settle lady who volunteered to test a coronavirus vaccine on March 16. She was all over the news and raised hopes of early trials and a quick vaccine discovery. But we haven’t heard anything about her since. Google her – you won’t find a thing. Mysterious. And why does it take so long to develop a vaccine? We’ve known the genetic make-up of the virus since the Chinese mapped it in January. Our amazing biotech companies have been telling us they have vaccines ready to be tested for some time now. What’s taking so long? And what happened to Jennifer Haller?
We’ve shut down the economy. Can you do that?
Planes aren’t flying, office buildings are dark, restaurants are shut, Disney World is closed. Our factories have been mothballed. The entire economy has ground to a halt. And most of the world is right there with us. How long can we do that? Will we impoverish ourselves?
Is it possible for the Treasury to borrow $2 trillion and the Fed to print $4 trillion and pass it around to keep us afloat?
More than possible -- they’ve done it. Doesn’t the debt have to be serviced? Can we possibly afford it? Will the Fed’s largesse generate runaway inflation? We were told Modern Monetary Theory was nonsense. It was laughable. And yet, we’re testing it now. If you need money for an important purpose, just print it. Interest rates are low, almost at zero. Will they always be that way? Will the Fed eventually forgive the Treasury debt they purchase? Why not?
Having shut down the economy, how do we reopen it?
Slowly? Piece by piece? After we’ve tested nearly everybody to find out who’s immune. Is any of this practical?
We’re not sick, but we’re not exactly well, either.
Nobody in our house has the symptoms: fever, cough, aches, trouble breathing. But we’ve all had bad colds – weird, long-lasting, much worse than usual colds, starting in January and continuing, for some of us, to the present. Do we have the bug?
How could we have blown the testing so badly?
The US was late in testing and slow in rolling out good tests all over the country. The CDC insisted we use their test and denied requests for the use of local or foreign tests. And the CDC test didn’t work! Since early March we’ve been playing catch-up. We all know the story of South Korea: they had good tests and administered them broadly from day one. Germany is also better at testing and tracking. We are told widespread testing in the US is right around the corner…but we haven’t seen it yet.
How did we ever get by without Disney Plus?
If you have small children in the house, you know what I mean. God bless you, Bob Iger.