The bright side is there if you take time to look
Canadians find the daily news stressful. We just want relief. We want normal. Business forecasters tell us things will soon return to normal. But, will they?
After every past crisis, life went on, except in each case life changed, and looking back we can say, for the better. The current life-altering situation is often compared with past crises. Those events like the Great Recession and 9/11 panic were contained by corrective action taken. This stock market crash and health crisis will also pass into history, but life will be different.
We know the bad, but what have we learned for the good? Here are some thought-provoking examples that demonstrate how crisis can be merely the other side of opportunity.
Canada’s federal government is conducting a virtual parliament part of the time, starting with question period carried out online rather than “in the House.” It’s potentially efficient (more information at less dollar-cost). Can online apply also at provincial, municipal and levels?
Students and teachers are able to carry out distance learning from home instead of classroom, by using the internet that young minds are very familiar with. Will that medium be expanded, with two-way questions and answers and marking, to benefit both teachers and students?
Religious practice can be carried out online, too. Pope Francis’ Easter mass before a TV camera in a nearly empty St. Peter’s was telecast to millions more than were ever able to attend inside the Basilica. Isn’t that a model for local places of worship?
Many investment funds will report double-digit declines in their first quarter net returns, as they did 12 years ago. Their investor clients realize that stable returns are unlikely when the largest part of their portfolios is invested in unstable public equities. Shouldn’t they reassess how much equity weight is still appropriate?
It could be worrisome for the everyday investor. That’s why we recommended they listen to an experienced adviser and ensure their portfolios are properly balanced to reflect their needs, in earlier articles in this series. How can a digital adviser satisfy that need?
University endowments, charitable and hospital foundations are fiduciaries — they hold investments to benefit others. Many years ago, my former trust company boss, the late Norman Cunningham, zeroed in on the nature of these services by explaining “The fiduciary business is the investment business.” Did we forget the hallmark of a fiduciary — the prudent investor rule?
Lower but more stable net returns in the future from endowment and foundation portfolios may become acceptable if their beneficiaries’ income requirements were to reduce also, rather than continuously rise. Will perpetual double-digit growth need to be “rethunk” in a low-growth era?
Technological advances and innovation show how costs can reduce, using remote medical testing and diagnosis, digitized regional health centres, some for-profit health services and professionalized long-term care. Isn’t it likely that tech applications will proliferate?
Some homes, condos, businesses and social and charitable properties may become unaffordable and even redundant in this digital age. Do they call for a rethinking of “what’s really needed?”
Old-fashioned household virtues practised during lockdown challenge us. Have we forgotten parenting, togetherness, games, home schooling, home cooking (my contribution was a 14-ingredient “empty the fridge” stew thick enough to stand up a spoon) and oral communication?
Earth Day, April 22, dramatized not only the seriousness of the stock market and economic downtrends worldwide but also a directly consequential fall in air pollution. Can a gradual recovery coexist with clean air and a healthy environment?
Elementary and secondary schools today and universities tomorrow may need to merge and combine, just as businesses do, to reduce costs. Will they be able to operate without annually rising grants from governments and big returns from their endowments and foundations?
Education and health services eat up almost two thirds of the government’s budget. In normal times, a finance minister’s job is the loneliest in every cabinet — How to balance these big slices against spending requests from two dozen ministers comprising the other one third? Will balancing many budgets after the recession become a forgotten hope?
Everyone knows present times are abnormal. On top of immense deficits accumulated from past years of overspending, governments and central banks added huge amounts to prevent the world economy from collapse. That new role will be analyzed in a later article in this series.