“Morning Boys.  How’s the Water?”

A few days ago, I posted an article called “Maybe There’s More to This Than Just Trying to Meet Demand.” Among other things, I ask you to take a little time and a deep breath and think about what the future looked like.  Towards the end I repeated a Mark Twain reputed quote; “It ain’t what you don’t know that gets you into trouble.  It’s what you know for sure that just ain’t so.”

A day or two later Sam Rines, the Chief Economist of Avalon Advisors published one of his occasional notes with a few charts asking, “What if a vaccine does not alter the overall trajectory of the economy?”

Here’s a link to that note.  Talk about hiding in plain sight and things you know that just ain’t so.  Remember, we were in a recession before the pandemic.  The Great Recession took us years and years to get over.  So somehow, we’re going to get a vaccine, which we have to assume works and enough people take, and suddenly the economy is going to be okay.  Better?  Hell yes.

But the virus may have scrambled the economy in ways we don’t completely know yet, so why are we imagining that resolving the pandemic means suddenly the economy will be strong?  Could it just sort of limp back into the recession we were already experiencing but be further beat up by a gigantic pandemic hangover?

How did I manage to confuse my personal pandemic recovery, where I can go to a bar, take my wife to dinner, have friends and family over and maybe even consider a vacation, with the economy recovering?

What does it mean if they are two separate issues?  Think about it.

Two young fish, out on a morning swim, bump into an older fish. He says: ‘Morning boys, how’s the water?’ The younger fish nod in appreciation and swim on. A few minutes later, one looks to the other and says: ‘What the hell is water?

We’re all swimming in that water, but sometimes it’s hard to notice it.