Corona Coping: Listen to Your Doctor and Financial Advisor
- by: Hank Berkowitz
- March 1, 2020
One of the great things about my building is that you can network informally with so many smart people from all types of businesses and professions. After a week like we just had, it can be very helpful to get a big-picture global perspective from outside the financial world.
The International Medical Crisis Response Alliance (IMCRA) is right down the hall from me. Executive Director, Dr. Tom Hedberg and I have become friends thanks to shared interests in fitness, fiction and coffee-intake. Like behavioral finance pros, neuroscientists like Dr. Hedberg are fascinated by the way that human emotion takes over our rational decision-making during times of stress.
I asked Hedberg how serious the Coronavirus really is in the U.S.
Hedberg said it’s very hard to predict because U.S. citizens are historically not likely to be “closely bound” by government regulations concerning quarantines and isolation measures. “While our treatment facilities are excellent, a virulent airborne mutant contagion could prove a serious threat, and that widespread infection rates could easily overwhelm such facilities,” noted Hedberg. That being said, Hedberg believes Americans are “exceptionally well-informed about medical and health issues” and that most of us will take appropriate measures such as using disinfectant wipes in the home and gloves in public.
The bottom line of course will be the number of virus carriers coming into the country from high infection-rate areas. “This can be limited by curtailing flights FROM such countries and encouraging flights OUT of the US,” added Hedberg.
While infection rates could be significant, experts say fatality rates so far have been low.
“It appears the virus in its current form poses the greatest threat to elderly persons with pre-existing health conditions,” noted Hedberg. “Young children are only slightly affected and robust healthy persons are: 1) likely to get over the infection on their own and 2) Very likely to get over it with treatment.”
Hedberg reiterated the importance of staying calm and not overreacting to the news coming out of other countries, as well as the inflammatory domestic headlines about Wall Street and the economy.
True, the stock market had its worst week since the 2008 global financial crisis. But even with a 12-percent sell off, the broad-based indexes are still up by about 6 percent over the past 52 weeks and up by over 400 percent since 2009. While he’s not a professional investor, Hedberg said he’s going “bargain hunting” next week for undervalued stocks.
While over 80-percent of respondents to our annual CPA/Wealth Advisor Confidence Survey™ think we could see another 10-percent market correction within 12 months, only one in five (21%) think it’s “very likely” we’ll experience a recession within that time. That number moved only 5 percentage points from this time a week ago, before the market sell off began. There’s still time to take the survey….Give us 5 minutes of your time, and we’ll send you a report to show your responses stack up to your peers.
NOTE: We don’t make money from the survey or share respondent names or emails. It’s a pro bono effort in association with The Financial Awareness Foundation.
Whether talking about your finances or your health, the bottom line, said Hedberg, is to use common sense:
1) Refrain as much as possible from crowded environments where many people are breathing and re-breathing the same air.
2) Wear gloves in public whenever possible.
3) Use facemasks in public whenever possible (This is de rigeur in Japan and should become so in the U.S.).
4) Increase intake of vitamin C through citrus fruits.
5) Avoid physiologic stress situations such as going out into the cold inappropriately dressed.
6) Don’t get spooked by the headlines.
As with so many upsets in life, staying calm and using common sense will get us through this crisis and all its residual impacts. Don’t succumb to the headlines. Heed the advice of your financial and medical advisors and don’t hesitate to reach out them with questions or concerns. Let’s get on with your busy lives.
# Corona virus #stock market #Tom Hedberg #IMCRA