It’s reasonable to be concerned when a previously-unknown virus reaches pandemic proportions. Our questions go beyond, what happens if I get sick? We want to know how this might impact our daily lives? Our finances? Our future? With current research and historical data from trusted sources, we offer a broader perspective on Coronavirus that should help put your mind at ease. Click below to watch our latest video (approximately 6 minutes), or scroll down to read the full transcript. For more perspective on the cyclical nature of the financial markets, read our 2011 article, “The Peril of Panic for Investors.”


A Broader Perspective on Coronavirus: Full Video Transcript

The world learned of the previously unknown Coronavirus in December 2019, when China announced an outbreak had occurred in Wuhan city several weeks before. The virus had already spread to neighboring countries, and by mid-March 2020, more than 110,000 cases of COVID-19 had been reported in 100 countries, according to the World Health Organization.

While the situation is challenging, the WHO also stressed that such numbers don’t tell the whole story. Of all the cases of COVID-19 worldwide, 93 percent are in four countries: China accounts for about 81,000 cases; and Iran, Japan and Italy have roughly 7,000 cases each.

“We are not at the mercy of this virus,” WHO Director-General Tedros Adhanom Ghebreyesus said in a press statement March 9. “With decisive, early action, we can slow down the virus and prevent infections.”

It’s reasonable to fear an outbreak of a previously unknown virus, and taking safety precautions is prudent. (At the end of this video, we’ll share some tips from the U.S. Center for Disease Control on how to protect yourself and others from the spread of germs.)

That being said, it’s never wise to panic. Life happens. There will always be things we cannot predict and cannot control. But fear should not drive our decision-making or cause us to shut down our lives. Because doing so often causes more serious consequences than the original threat.

The COVID-19 outbreak began to rattle the financial markets in January. By February, businesses were canceling annual conferences, local governments were banning large public events, and some municipalities were even closing schools. These cancellations and restrictions were made in response to public fear, rather than to WHO or CDC recommendations. Regardless of the reasons, such actions cause immediate strain on local communities and create far-reaching ripple effects to national and global economies.

Dramatic volatility in the global investment markets has been one effect. Large swings in the stock market make people nervous and the knee-jerk reaction is to pull money out of the market. In most cases, individual investors who allow their emotions to dictate their investment decisions will suffer from poor long-term results. This occurred in the wake of the 2008 financial crisis. Investors pulled their money out of the stock market as a reaction to the sharp decline, only to subsequently miss out on recouping losses in the dramatic recovery that followed.

While the past is not predictive of the future, it does offer valuable perspective. Charles Schwab recently conducted an analysis of 13 global pandemics over the past 50 years. Their data shows that once the number of newly identified cases starts to decline, economic activity and the stock market tend to quickly rebound. A key reason, according to Schwab analysts, is that global health organizations are prepared for outbreaks and are effective when mobilized. Combining these efforts with widespread public awareness and adoption of effective safety measures eventually limits the spread of the virus and its economic impact.

Leadership Consultant Maureen Monte recently pointed out that emotions are energy, and the crisis the world faces today is more about energy-management than COVID-19. “It’s important to remain calm, positive and realistic in the face of a relatively unknown and uncertain threat,” she said.

How, exactly, does one remain calm, positive and realistic?

  • Think about how you’ve responded to troubling events and worries in the past. Write it out. Was the outcome of your action positive or negative? What might you learn from that experience to help you today?
  • Use logic. Flu outbreaks hit us every year. It’s a part of life we’ve all come to accept. There are also natural disasters, political scandals and tragic accidents. Most of these are outside of your control. Yet, how you respond is entirely within your control.
  • Turn off the news. With the current 24/7 onslaught of news, it’s critical that we each manage how much time we invest in following the commentary. There’s a difference between being informed and being obsessed. Use your energy productively. When you want an update, go straight to the source at the CDC and WHO websites.
  • Focus on the good things in your life. Do what you enjoy. Spend time outdoors, have coffee with a friend, whatever makes you feel happy.
  • If you’re feeling anxious about your financial situation, call or meet with your advisor and talk about it. Expressing your concerns can go a long way in relieving your stress.
  • Keep your eye on the long-term horizon. Patient investors with a solid investment plan that balances risk and reward with a diversified portfolio tend to be rewarded in the long-term by staying the course.

How to Protect Yourself and Others from Germs

Help prevent the spread of COVID-19, flu and other diseases with these simple recommendations from the CDC:

  • Avoid close contact with people who are sick. If you’re not feeling well, stay home.
  • Wash your hands often to help protect you from germs. If soap and water are not available, use an alcohol-based hand rub.
  • Cover your mouth and nose with a tissue when coughing or sneezing. If you don’t have a tissue, cough or sneeze into your sleeve.
  • Avoid touching your face. Germs are often spread when you touch something that is contaminated and then touch your eyes, nose, or mouth.
  • Practice good health habits. Clean and disinfect frequently-touched surfaces. Get plenty of sleep, be physically active, manage your stress, drink plenty of fluids, and eat nutritious food.
  • Take extra precautions for elderly people, young children and those with severe chronic conditions, who are at higher risk of developing serious complications when ill.