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Perspective Newsletter

By the time you read this article, the calendar will say early August, which means it has been almost five months since our world changed forever. March 11 might not yet register in the way that September 11 does, and perhaps due to the length of this crisis and the unforeseeable future, it never will. But for me, March 11 was when coronavirus went from something you heard about on the news to something that impacted your life directly.

In the space of a day, the WHO declared a global pandemic, Tom Hanks contracted Coronavirus in Australia, the NBA suspended its season indefinitely, and Donald Trump made his second ever Oval Office address. By the time Trump finished speaking, he had suspended travel between the United States and Europe for 30 days, and the Dow Jones had fallen 600 points in 10 minutes. Fewer than 24 hours later, Northwood made the decision to temporarily shut down our offices and shift to a work from home model for the first time ever. Four months later, we’re all still working from home, and don’t plan on having the full team back in the office any time soon.

But in the words of the iconic poster prepared by the British government in advance of World War II, we have all had no choice but to “Keep Calm and Carry On.” The world has kept spinning, and the transition to work from home has gone remarkably well for those of us lucky enough to be able to do so. At Northwood, we’ve hired and onboarded two new staff members since March and switched to conducting our meetings with clients via Zoom video calls. We’re looking forward to seeing our clients in person again eventually, but I wonder how many of them are going to want to come see us in a Toronto skyscraper, now that they’re aware of the video conferencing option. Do our clients really want to leave the dock in Muskoka, or the deck in Creemore, to fight traffic on their way into the city? Or would they rather click a Zoom link and see our faces pop up on their screen in seconds? Only time will tell.

It is also worth considering the impact of the last four months on our wider world. A March lockdown that we thought might be over in a month has extended into the 3rd quarter of 2020. Masks have become commonplace (if not mandatory), hugging is taboo, office towers have transitioned to ghost towns, and every single decision we make now comes with a risk factor to contemplate. To be honest, it can be exhausting and feel all encompassing at times. To illustrate just how perspective-shattering this crisis has been: the Australian wildfires happened earlier this year. When I read this reminder recently in an article reviewing the major news stories of 2020, I thought it was a misprint. After all that we’ve been through in the past four months, that particular crisis feels like it took place about a decade ago.

With all that said, you’ve read this far because you’re interested in reading about five thoughts I had on the pandemic. Without further ado, here they are:

1. The Test is Not that Bad

I recently got tested for coronavirus as a precaution before seeing my soon-to-be 90-year-old grandmother for the first time this year. I walked to St Mike’s Hospital in downtown Toronto, waited in line, and had my test completed in just over an hour. You tilt your head back, and a doctor inserts a swab into one nostril for five seconds. It is mildly uncomfortable, but to be honest it was over before I had a chance to really think about that discomfort. You then log in to a website and can access your test results within 48 hours. Repeatedly pressing refresh on the results screen brought back fond terrible memories of CFA Exam results days, but eventually I received the relief that comes with a negative result.

Is it a perfect process? No. Would a saliva test, or an at-home testing solution, be better? Yes. However, it is all we have right now, and no one should let the fear of five seconds of slight discomfort stop them from getting tested.

2. This is a Marathon

Let me preface this next point by saying that nobody knows anything right now, and making predictions is a fool’s game. With that said, there seem to be quite a few people acting as if life is back to normal or will be shortly. As more and more businesses have reopened, hope is rising that maybe things will be fine by Halloween.

From the reading I’ve done, I’m less optimistic. I don’t think we’re going back to the office this year, and I don’t think our kids are going back to school. The patios will be closing once the weather gets colder, and the indoor sections of restaurants may also be forced to close again. If you’re a Canadian, you’re not going to be travelling to Florida or anywhere warm this winter.

I hope I’m wrong on all of the above items, but I do think we need to accept the possibility that office towers and schools will still be closed at this time next year. It is much better from a mental health perspective to prepare for the worst and continue to hope for the best, than to expect that the next six months are going to be anywhere near normal.

3. What if You Knew this Was Coming?

All credit goes to Northwood’s President Scott Hayman for bringing up this question on a recent call the two of us had with a client. It is an interesting thought exercise, and directly relates to my previous point (This is a Marathon). Other than the obvious answers –such as taking a three-week international vacation in January, or buying shares in Zoom– it is worth considering what you would have done differently to prepare for the pandemic if you had the foresight to know it was coming.

If I’m right about this being a long haul, it’s also worth thinking about what you can do now to prepare for the next 12 months. After spending the first three months of the pandemic working from a laptop at the kitchen table with my wife, I finally went ahead and invested in a more long-term work from home setup last month. It is a simple desk, computer chair, external monitor and keyboard, but it has already done wonders for my productivity (and spine).

Whether it’s improving your work from home setup, buying a stationary bike and weights, or something else that makes you happy, it’s worth getting it done now to prepare for what’s ahead.

4. We Still Don’t Have a Plan

The lockdown was never supposed to last until we got a vaccine. It was a stopgap solution to slow the rate of infection and should have been used to develop a medium-term plan (ie. post-lockdown, pre-vaccine). Many have argued that the places currently getting hit with outbreaks opened up too early. I disagree with this, I think the problem wasn’t the timing; it was that they opened up in an unreasonable way. As we move into looser phases of lockdown in other places (Indoor dining? Bars?? Middle seats on planes!?!?!), it is worth considering just how far we can push this with a virus still circulating all around us. To me, it doesn’t seem like enough thought has been put into how we can have a semi-functioning society before we have a widely available vaccine. I’m optimistic that a vaccine is eventually coming, but I’m pessimistic on our ability to manage the time before that vaccine comes.

5. The Big Picture View

One of my favourite writers on investments and behavioural finance, Morgan Housel, recently wrote the following:

“If COVID-19 struck the world in 1920, it would be a single page in the history books about yet another deadly pandemic wedged in between a long list of common tragedies. But since it happened in 2020, it will be a generation-defining event that fundamentally reshapes how we think about risk.”

I’m not sure I entirely agree with his conclusion, but taking the long perspective is always a useful exercise. Beyond the Spanish Flu of 1918-19 that killed an estimated 50 million people (vs. COVID-19’s current toll of fewer than one million), people of the not-too-distant past died regularly from infectious diseases in advanced countries. Polio used to tear through cities like Toronto and New York each year and leave thousands of children paralyzed or dead in its wake. Other diseases such as typhoid, diphtheria, mumps, measles, and the flu also exacted a much heavier toll than they do today.

There is no doubt that coronavirus is a tragedy and that the global death toll continues to grow at an alarming rate. With that said, our reaction to the outbreak has been influenced by the fact that six months ago, most of us could never have imagined the world we are now living in. We really believed that deadly pandemics were a thing of the past, and that makes getting hit by one in 2020 much more impactful than it might have been even a few decades ago.

So, there you have it, five thoughts on the pandemic from someone who is not a scientist or any sort of expert on infectious diseases. I’m just proud I managed to write 1,500 words on coronavirus and only mention Trump once.

Enjoy the rest of your summers and stay healthy.

 

Northwood Family Office

Scott Dickenson

Scott Dickenson

Scott Dickenson is a member of Northwood's client development and client service teams. In his client development role, he is responsible for strategy, communication, education and new client growth. In his client service role, he works with Northwood’s client families in the areas of financial planning, investment management and taxation. Scott is a Chartered Financial Analyst (CFA) charterholder and a member of the Toronto CFA Society. He holds a Masters of Business Administration (MBA) from the Rotman School of Management at the University of Toronto, and an Honours Bachelor of Commerce (BCom) from the Smith School of Business at Queen’s University.

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