Heute Corona:
- and what comes tomorrow?
24 February 2020
Every day we receive new reports about the further spread of the Corona Virus. The future will show how this virus spreads and what worldwide health effects it will have in the end. But this means for the world economy and what conclusions do we draw from this?
The fact is that the global economy will shrink in the first quarter and, depending on how the spread develops, may lead to a recession in the first half of the year. Global supply chains are coming to a halt and the interdependencies of the global economic system are becoming apparent. Examples include the automotive and pharmaceutical industries, which at some point have completely relocated key components/raw materials to China for cost reasons. But it actually runs through almost all industries in an increasingly global competition. Conversely, China is one of the most important sales markets for the automotive industry, and the new car market there has currently come to a standstill.
Could we expect the Corona Virus? No, but not only since the Black Swan, which Nassim Nicolas Taleb introduced to us in his book of the same name in 2007, we know that there will always be such events, which are initially classified as rare to improbable and for which humans have a simple and understandable explanation afterwards. So we already know today that there will be black swans again after the corona virus, but we do not know the time and characteristics.
What conclusions should we draw from a global economic perspective? On the one hand, dependencies in global supply chains and their effects must certainly be questioned, but on the other hand we must also be aware that the black swan in the form of the corona virus is disappearing again. This means that there will be a significant recovery of the global economy in the 2nd half of 2020 at the latest. The stock markets are reacting relatively cautiously anyway, despite the presumably weak quarterly figures of the corporations in 2020, because there are no alternatives and, given the current liquidity glut with accompanying penalty interest rates, we will be forced to our luck.
Why luck? Because we must finally learn to think long-term and not only in quarters. Just because of a few weaker months, for which the company itself is not responsible, nothing will change in its value and potential. As long as the strategic orientation is right, the necessary product quality is in place and the stable customer base returns, there is no reason to panic in the medium or even long term. Those who understand this can make wise and long-term successful investments, especially in these times of the Corona Virus and future black swans.