Dr Mukul Chandra Kapoor, Director Anesthesia in Saket’s Max Smart Super Speciality Hospital in Delhi, in an exclusive conversation with NewsX, talked about the novel coronavirus aka COVID-19. He said whomsoever you hear, read or interact with is only talking about this virus and measures to control its epidemic spread. Leaders and individuals who had called it an overhype or a bluff has been proved wrong. It has indeed proved its mettle and shown the non-believers that it’s no humbug. The virulence of the virus is indeed unmatched. We had organizations, religious leaders, and individuals claiming to have fool-proof prevention and therapy to counter its threat. Still, none of these seem to have worked.
The virus has just not come to invade, but rather be an occupation force, and will rule the earth for some time. It has already changed the way humans behave, have restricted our lifestyle, our movements, and even our behavior. The wrath faced by humans will continue for a few months, at the least, or maybe a year. It’s time we think about life in its aftermath.
We have already seen the economy crashing. The economy will continue to hit until the virus rules our lives. Many industries and organizations will cease to exist, as their revenue will be totally wiped out. Government coffers will get wiped out as non-budgeted spending will be unprecedented and tax collections dismal. It will make it impossible for governments to improve the tax collections, even if they raise taxation, as productivity will remain at an all-time low. The service sector will be the worst hit, as it involves social contact. All industries working remotely, such as the internet marketing sector, will boom.
Healthcare is one service sector that will continue to remain in business. The dynamics of the industry will, however, have to be redefined. Governments will need to allocate larger healthcare budgets, but revenue constraints would prevent a significant increase. The paying power of the public will be lower than before, and profits will shrink. The preference of healthcare budgets will shift from treatment of lifestyle ailments and cancer to prevention and infectious diseases. Non-emergent surgeries will tumble, and therapeutics will sustain hospitals. Pharmaceutical manufacturers will benefit, but implant manufacturers will fumble.
No industry will be free from the onslaught of recession except possibly the sanitation and healthcare industry. Banks and companies will fumble, and so will organizations. The months of low and no production will leave industry debt-ridden. There will be no working capital. A massive workforce reduction will take place, and remunerations will be drastically cut. Many companies will get bankrupt, and a large workforce will become unemployed. Banks will be loaded with non-performing assets. The tourism and aviation industries will take the most significant toll, as restricted or no flying for an extended period will definitely bankrupt these already flailing industries. Countries with tourism-dependent economies will crash.
Investments in all sectors will see negative growth, and everyone’s money power will be diluted. Share markets will continue to fall, and large sums of unrealized profits will vanish. Many bulls will try to make a killing, with shares trading at low rates, but they may be in for a shock as the recovery if there will be at a snail’s pace. Some investors with deep pockets may survive but after sustaining huge losses.
What can you do in such an environment? Hold on to your resources! Avoid investment, as all investments have significant risks. Keep enough money with yourself to see through the bad weather. Be frugal in spending and avoid potentially wasteful expenditure. Avoid expensive gifts and exotic trips. Be prepared for the negative growth of your income and budget accordingly. Remember, this virus is attacking not just your health, but the entire human society and civilization.