A K-shaped recovery does seem to be the logical answer when it comes to economic growth post Covid-19. For those unfamiliar with this “K-shape”, this article provides a helpful primer: K-Shaped Recovery Definition (investopedia.com)
For businesses, there may be semi-permanent changes in certain sectors (e.g. office rental). I think many have become accustomed to having a more flexible work-from-home arrangement, and businesses are starting to realize that they can potentially cut down on fixed costs like office rentals, in favour of a more hotdesking-type concept.
Separately, consumer habits are starting to change. Personally, I have been more open to ordering in meals, consumer products and groceries and such a trend would likely continue on post-Covid. This will potentially be a sustained tailwind for logistics and transport sectors (including industrial warehousing).
There has been a lot of chatter about a potential consumer driven boom once the lockdowns are eased. I do believe it will happen for the airline and hospitality sectors but perhaps the tailwind will only occur in 2022, since its largely dependent on how quickly the vaccines are administered globally.
On the other hand, a lot of countries have executed massive stimulus measures to support their economies in the past year, via fiscal measures (tax cuts, unemployment handouts, wage supplement schemes) as well as monetary measures (lower interest rates and QE programs to infuse liquidity into the financial market).
As the economy improves, these programs will also be phased out, so the overall stock/bond market might not perform as well as it has done historically.
A K-shaped recovery does seem to be the logical answer when it comes to economic growth post Covid-19. For those unfamiliar with this “K-shape”, this article provides a helpful primer: K-Shaped Recovery Definition (investopedia.com)
For businesses, there may be semi-permanent changes in certain sectors (e.g. office rental). I think many have become accustomed to having a more flexible work-from-home arrangement, and businesses are starting to realize that they can potentially cut down on fixed costs like office rentals, in favour of a more hotdesking-type concept.
Separately, consumer habits are starting to change. Personally, I have been more open to ordering in meals, consumer products and groceries and such a trend would likely continue on post-Covid. This will potentially be a sustained tailwind for logistics and transport sectors (including industrial warehousing).
There has been a lot of chatter about a potential consumer driven boom once the lockdowns are eased. I do believe it will happen for the airline and hospitality sectors but perhaps the tailwind will only occur in 2022, since its largely dependent on how quickly the vaccines are administered globally.
On the other hand, a lot of countries have executed massive stimulus measures to support their economies in the past year, via fiscal measures (tax cuts, unemployment handouts, wage supplement schemes) as well as monetary measures (lower interest rates and QE programs to infuse liquidity into the financial market).
As the economy improves, these programs will also be phased out, so the overall stock/bond market might not perform as well as it has done historically.