While our government officials are talking about re-opening at least parts of our economy, we are all wondering what that will actually mean. There is no doubt that we can’t just flip a light switch and get people to rush out and start partying in the streets. We are obviously talking about some sort of staggered opening.
What does that mean? Well, certain rural counties could open up right away. Dense cities with a high percentage of cases are not likely to open. Certain industries may open in different ways. For example, sports are being considered without fans in empty stadiums and arenas. Perhaps people will have to get tested before they board an airline flight (assuming we have a ten-minute test). We will call this the new normal.
Thus, the question is not just when will the economy open up? It is also what will the new normal look like and how long will the new normal exist? Again, we refer back to the medical part of the equation. If we have an effective vaccine in place and perhaps even an effective drug to limit the effects of the virus, the new normal will be gone much quicker. The answer to these questions will tell us not only how long the economy will slump, but how long it will take to recover. We believe we will be asking these questions for quite some time.