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Corona crisis

Since the last few months, COVID-19 is spreading extraordinary fast. In China and Europe measures are taking to relieve the health system which slows down the economy.

Does the virus disappear by itself?

No, this was fortunately the case with SARS-1 with higher temperatures and it was firstly expected for Corona but there is no correlation between temperature and infection rate found.
So, it is unlikely that it will disappear quickly.
It is far more likely that this pandemic isn’t containable anymore and we need to live with it.

When does this pandemic end?

As soon as an effective medication or vaccination is available.
Researcher are testing currently available medication (e.g. Malaria remedies) intensively. Until now, none of the therapy approaches has worked.

How does this affect our economy?

The bad news are that the worldwide economy is affected by this crisis due to shutdown measures to keep the pandemic controllable. Other the bright side, some industry sectors has been more hit than than others.

Revenue decreasing industries
  • Travel industry
  • Consumer goods
  • Supplier
  • … a plenty of other grasp industries
Revenue increasing industries
  • All digital products
  • Streaming products (Netflix)
  • Gaming/Esports
  • E-Commerce (some more some less)

Of course, there are far more traditional products than digital products and therefore the crisis is hitting hard on the index funds like Dow Jones or S&P 500.

Cleaning effect of the crisis

Every crisis has its advantages, right now you can buy highly leveraged companies that are on the brink of bankrupancy.
Furthermore, companies that have converted their work as much as possible into the digital space will now come out as the winner of this crisis. Others might be able to adapt in this phase and the ones that doesn’t recognize the lack of digitalism in their work are doomed.
Based on this criteria, you should buy and sell your stock.

Lessons learned for the future

So nowadays the globalization is questioned. Well, it shouldn’t.
The globalization is a normal and healthy development in a capitalistic system. Not to forget that Italy was recently able to receive medical supply of China within hours.
But it should be questioned whether a consultant is required to be present in one week in Dubai and the other in Syndney. If the used tools would be good enough, it wouldn’t be required to travel anymore. Even difficult operations should be conductable through Home Office. This is the thinking that we are needing right now.
Where are humans still required? Would it be better to use as many robots as possible, for shipping and for health care.

How you this crisis look like when their would be no health workers required because every step is automated and executed by robots?

Summary

See the positive in this crisis and be aware that now are the best times to make good deals. Choose your stocks wisely and don’t get into specutaling. Wait until the bottom is hit by the and start buying with full hands.

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By Alexander

2.64

Founder of StockVoting, passionated investor, programmer for autonomous driving.
Convincing people that with the right analysis you can drastically improve your investment performance.

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