The collapse of economic activity in 2020 from COVID-19 has been immense. An important question is how much of that resulted from government restrictions on activity versus people voluntarily choosing to stay home to avoid infection. This paper examines the drivers of the collapse using cellular phone records data on customer visits to more than 2.25 million individual businesses across 110 different industries. Comparing consumer behavior within the same commuting zones but across boundaries with different policy regimes suggests that legal shutdown orders account for only a modest share of the decline of economic activity (and that having county-level policy data is significantly more accurate than state-level data). While overall consumer traffic fell by 60 percentage points, legal restrictions explain only 7 of that. Individual choices were far more important and seem tied to fears of infection. Traffic started dropping before the legal orders were in place; was highly tied to the number of COVID deaths in the county; and showed a clear shift by consumers away from larger/busier stores toward smaller/less busy ones in the same industry. States repealing their shutdown orders saw identically modest recoveries–symmetric going down and coming back. The shutdown orders did, however, have significantly reallocate consumer activity away from “nonessential” to “essential” businesses and from restaurants and bars toward groceries and other food sellers.
I admit to having a short attention span. My mind tends to wander a bit, sometimes a lot. The reason for my cognitive wandering is usually a question which sends me down yet another path of discovery. So here’s another post in my intermittent series on Post Pandemic Changes in Consumer Behavior
My July 4th weekend will be a quiet weekend. I’ve downloaded the pdf of this working paper to read. I’m hoping for some insights that I might have missed.
Roughly two in five Americans (38%) say the COVID-19 pandemic has impacted their retirement plans by having to retire later than planned, now not being able to retire at all or being forced into retirement. Plus, 41% are currently reevaluating their retirement plans to assess the financial impact of COVID-19. These are among the findings revealed by a new COVID-19 Tax Survey conducted online in May 2020 by The Harris Poll on behalf of The Nationwide Retirement Institute® among U.S. adults 18+. Heightened uncertainty and complexity are driving a need for greater financial protection. Roughly half of Americans agree that the COVID-19 pandemic has made them recognize the need for annuities to protect their investments against market risk (47%) and to protect their retirement income (48%). More than half of all U.S. adults (57%) and investors (60%) also say the pandemic has made them recognize the need for life insurance.
More survey results can be found in the full article at the link above.
The heightened uncertainty and complexity have definitely affected my own retirement plans.
The massive number of people out of work have definitely affected my own thoughts and feelings about work.
Retirement = work.
As long as my health holds up and as long as there’s someone out there willing to pay me to do what I do I plan on working.
I’ve been on several cruises in my life. As an excessive weight challenged individual cruises have always been problematic for me. Too much food. Too much alcohol. The last opportunity to join relatives on a cruise was a few years ago. I declined to participate. I just don’t like cruises.
But I also don’t like witnessing businesses crash and burn. Stunning number.
Sheltering in place has pushed virtual health care into the mainstream, making us wonder if we’ll ever go back to waiting rooms
A lot of bad reasons for not having life insurance but my favorite is the last one.
Death. Think about it.
Delinquencies of auto loans to borrowers with prime credit ratings were near historic lows (0.27% in March), according to Fitch data. In the pre-Virus Good Times, it was the subprime loans – with credit scores below 620 – that were blowing up…
In mid-March, the world changed for subprime lenders. Delinquencies were already exploding in the Good Times, and now they’re in utter turmoil.
In addition, it is likely that prime loans are becoming delinquent as well, as many of these people too have lost their jobs – this includes dentists and other professionals with high incomes and big debts and lots of expenses and no savings, who’d suddenly had to close their operations, and their cash flow disappeared. If they fall behind on their debts, they’ll be subprime in a hurry.
COVID-19 has had the biggest short-term effect on life insurance in two ways:
Insurers extending grace periods for paying premiums.
Placing a greater emphasis on accelerated underwriting.
Full article at the link below.
“We’ve been investing in our technological capabilities for years, and those investments really paid off when we needed to transition quickly to a 98 percent work-from-home model,” said Nationwide CEO Kirt Walker.
I’ve been working from home for nearly 14 years. Social distancing comes naturally to me at this point in time. It’s interesting to me a virus will be remembered as the Gladwell tipping point for showing the corporate world a better way of working.
98% permanent WFH!
Massachusetts Mutual Life Insurance Company (MassMutual) today announced the launch of MassMutual HealthBridge, which will provide free term life insurance to the brave and resilient frontline healthcare workers across Massachusetts and Connecticut risking their lives during the COVID-19 pandemic.
Even if you’re a big insurance company hater you have to admit this is pretty awesome.