A Leap Day Reality Check
By Jim Pearce
Every four years, we get an extra day to keep our calendar in sync with the cosmos. That day is today, February 29, which strikes me as a good time to reflect on the past four years.
Coincidentally, it has been four years since the outbreak of the coronavirus pandemic upended the global economy. Since then, stocks and bonds have been subjected to a whirlwind of interest rate cuts and hikes.
Nevertheless, the financial markets have held up remarkably well. This month, the S&P 500 Index closed above 5,000 for the first time ever and is up more than 50% over the past four years.
There's a lesson in there somewhere. Sometimes, we become so engrossed in the here and now that we lose sight of the big picture.
I think something similar is happening now.
To be sure, the wars being fought in Ukraine and the Middle East are serious business. Human lives are at stake, as is the sovereignty of the nations involved.
That may still be the case four years from now, just as COVID-19 persists to this day. In fact, the virus will never go away as long as there is an animal reservoir to keep it alive.
Even if COVID-19 is somehow eradicated from this planet, its impact on how we work, shop, and play in the United States will live on:
- The office vacancy rate is nearly 20% and still rising.
- Retail e-commerce sales are projected to grow at a 12% CAGR (compound annual growth rate) over the next four years.
- Online video gaming is now a $100 billion market.
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