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When the COVID-19 pandemic struck like a thunderbolt in late February 2020, the financial results were expected to crash the stock and bond markets, while the money available would be withdrawn or kept in the banks.
But in the following nine months, the initial stock market high point, along with bonds suffering similarly, reached in the extreme opposite way. The winners turned out to be the investors who held on or entered the market, while those who withdrew only maintained their liquidity.
How was this possible when the experts anticipated a crash similar to the one in 1929 that took World War II to lift the U.S. economy?
When focusing on the plus and minus factors, what was most unrealized was the positives provided for the stock markets. While the early withdrawal from the stock markets in March 2020 did cause a multiyear low, it soon became just the opposite.
Unexpected liquidity from small and middle-sized business shutdowns flooded the banks, as this unfortunate factor loaded the banks with unexpected money. But an even more amazing surprise was Jerome Powell and the Federal Reserve Board’s heroic effort in making money available in quantities never before generated by America’s arch-conservative central bank.
Overnight, this created investment opportunities never before seen. The U.S. stock markets, which seemed to have fallen flat on its back, suddenly became a focal point for investors, who foresaw a golden opportunity in the not-too-distant future.
Between the lows of early March and the year-end U.S. stock market, there were increases in stocks as much as 50 percent or more. It will be a matter of great interest to see if this incredible “expanse” will continue in 2021 and beyond.
Unexpected Surprises in 2021
While making New Year’s predictions may seem more than a convenient guessing game a year ahead, those making these predictions (myself included) will emphasize their brilliance if they hit a home run and forget about them if they are way off.
However, as the year 2021 is sure to answer more questions than usual, it would be cowardly not to take a shot at major factors that planted their seeds throughout 2020.
Most consequential and critical, of course, is the continuing impact of the global coronavirus disaster. It showed little signs of abating as the New Year’s trumpets tooted the incoming 2021.
Although not expecting much, it is also questionable is the presidency of Joe Biden, former Delaware senator and two-term vice president of the eight-year Obama administration. The voters seem to have wanted a lackluster four-to-eight years after the astounding changes brought about by President Donald Trump.
But one of the most astonishing surprises, good and bad, may well come out of the Middle East in a way hardly expected until the second half of 2020. It includes the good news of a positive peace, and even relationship, with such Arab powers as the Arab Emirates, Sudan, Morocco, etc.
The demanded commitment of a first Palestine State seems to have flown out the window. Even Turkey and Pakistan signaled a desire to make Israel a major fellow nationality, in what had previously been said would never happen.
While it seems doubtful now that former President Trump is projecting a second term of four years hence, Trumpism will likely evoke a major following among the GOP while letting him use his talents in influencing an increasing segment of American voters. They very likely will have second thoughts about the past campaign.
On the other hand, Trump will focus on his first term success to form an independent movement that could spread its influence into both parties. Time will tell!
Why Books are Coming Back
The year 2020 turned out to be one of the best periods since 2008. This was due to the sale of ebooks and audiobooks, which doubled the book total and showed an increase over the year before.
It has proved to be very timely, as regular book stores were closed in light of the pandemic, although publishers hoped to renew regular book sales in the future. This new form of reading seems to have changed the future of page-turners by the extent of circumstances.
Even Amazon caught on first and indicated a major effort to widen the interest in this new form of reading. This new development has caught on lightning-fast. In the long run, this century’s old reading method informed the public in a way not provided by any other form of in-depth reading, while not losing the book method of the future.
It’s expected that such a way of bringing forth biographies, children’s books and graphic novels was a sign of relief for the many good historians and otherwise who would find no comparable way to merchandise their writings.
It turns out that 2020 brought people more books online than ever before. This was helped by Amazon and a new book company, Bookshop.org, which routes sales to independent bookstores. Audiobooks are soon to spread. This will be particularly fulfilling to readers and superb historians like my son, Michael Beschloss — who has already topped readers’ lists for nine of the historical books that carry his authorship.
Interestingly, ebooks have not deferred the sale of regular books lately, admitted by the pessimists, who expected a severe slice of traditional books to be affected.