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Despite numerous attempts by the Federal Reserve to assuage plummeting futures, the US Stock market on Monday once again flipped the circuit-breaker. The circuit-breaker is the rarely-used mechanism that trips when the markets drop more than seven percent. Monday at 9:45 Eastern Time, trading resumed, after the brief cool-down period that was intended to give investors time to recover.
However, most investors are finding it hard to recover. The pandemic has swept across the globe and killed thousands, which has markets spooked. Nearly every stock future is a bad bet at present. Neither utilities nor gold seem to be the recession safe-havens they normally are. Investors are scrambling to find some way to save their investments.
Despite a generous relief package from the Fed, numerous emergency interest rate cuts and the constant words of reassurance from President Donald Trump, markets are in a full-blown panic. All of the Fed’s attempts to calm the markets have only given investors the impression that things are much worse than they anticipated. The markets continue to free-fall.
While Russia and Saudi Arabia engage in a price war over crude oil, thus tanking the price of gas, the demand for crude oil in the US has rarely been this low. Likewise, travel is all but nonexistent: airlines and cruises are seeing historically low numbers of people buying tickets, despite March normally being one of the busiest travel months.
These things, when taken together, have stoked fears that this could cause a global recession. While Americans are currently battling with flu symptom relief and the specter of dying from the novel coronavirus, they may soon have to contend with a cratered economy.
In the US, people’s anger over the handling of the virus is at a boiling point. Toilet paper remains inexplicably out of stock after a rash of baffling panic-buying. US businesses are slowing to a crawl. Several, like Apple and Abercrombie, have announced that they are closing their stores during the outbreak. This is to prevent the likelihood of spread.
This comes as the CDC warns Americans that all gatherings of over 50 people for the next eight weeks should be cancelled as the virus runs its course through the population. Major sporting leagues have all canceled or postponed their seasons to prevent large gatherings. This includes the NBA, MLB and Major League Soccer. Concerts, conventions and other such gatherings have also been canceled for the front half of the year.
