Most of us have had a fair bit of time to think about the coronavirus. After all, it’s pretty much upended our way of life. The way “things are supposed to be” won’t “be” for some time to come. No, we have to accept the consequences of COVID.
No doubt, everyone’s had thoughts about what this means for the future. Some of it’s already playing out in real time. Working from home, digital platforms hitting the mainstream, a rip-roaring trade in decorative masks, Netflix viewing going into overdrive. Some of these developments seem obvious. Well, at least in hindsight.
I’ve never been a great one for predictions. At least, I have enough awareness to know that I can be quite hit and miss (which is a useful talent to have in the finance industry). But very early on in the spread of the virus (and before the “pandemic” label), I was thinking long and hard about how this would play out. The unintended consequences of COVID-19, whether we’re talking about Asia or elsewhere in the world. Not that any of us truly knows. Still, having a framework has given me a way in which to think this through.
And clunky as the approach may be, it’s given some direction behind my current motivations. What this means for life and career.
So what’s my template?
Ok, so my starting point has been two major events from the last 20 years: the 9/11 terrorist attacks and the global financial crisis. Both have had major long-lasting impacts on our worlds in different ways.
Addressing the two events, I’ve broken them down into separate headings: What happened? / Who’s the “enemy”? / What was the fallout?
Ok, how does this look?
Let’s start with 9/11…
What happened?
There was a major terrorist attack in the US. Two planes flew into the World Trade Centre in New York, as well as an attack on the Pentagon. Thousands lost their lives.
Who’s the “enemy”?
The terrorists that perpetrated the atrocities are the obvious starting point. But the narrative shifted. It switched to terrorist states and the “Axis of Evil”. It also expanded more broadly to “Muslims”.
What was the fallout?
The birth of Homeland Security. Tighter security checks when flying. Locked cabin doors. You can’t carry on your liquids. Governments around the world sought ways in which to prevent a repeat.
But then came the War on Terror. Afghanistan, Iraq, Syria. Boots on the ground. Sympathizers led terror attacks in London, Madrid, Paris, Bali and so on. The overthrow of Saddam Hussein. The rise of Islamophobia.
Did 9/11 cause all of these? No. Fault lines didn’t just spring up on 9/10. But there’s no doubt it played its role as a trigger for what was to come.
Now, let’s look at the global financial crisis…
What happened?
Banks overstretched themselves. Hell, it was an era of cheap money. The housing bubble burst. The entire financial system almost collapsed. Millions of jobs were lost, trillions of dollars vanished into thin air. The central banks and governments had to step in.
Who’s the enemy?
Bankers and Wall Street. Or the fabric of capitalism, if you are heavily left-leaning. At least that was the easy narrative for the man on the street. At times there was little to differentiate the bank teller from the masters of the universe.
What was the fallout?
Bye, bye Lehman Brothers. Hello, bailouts. Banks merged to survive. Thousands of jobs were lost in the finance industry, though sympathy appeared to be in short supply. Occupy Wall Street had a mission.
The central banks stepped in to shore up global economies. Interest rates went low. Real low. Rates haven’t returned to levels of the past. Inflation hasn’t returned either. Yet. We learned a new phrase: quantitative easing. The market still hasn’t weaned itself off this drug either. This has become a way of life and we still don’t know how this central bank intervention globally will play out.
And the “bulge bracket”, once the obvious destination for the best and brightest, could no longer rely on the pick of fresh graduates. Google, Amazon and Facebook all offered a lot more – they had cash, they had growth and they weren’t struggling.
Banks were so last decade. This was even more so following the deluge of regulations that came in to protect Main Street from the evils of the financial system.
Finally, the coronavirus…
What happened?
The COVID‑19 outbreak was first identified in December 2019 in Wuhan, China. The World Health Organization declared the outbreak a Public Health Emergency of International Concern in January 2020 and a pandemic in March.
Who’s the enemy?
In the eyes of President Trump, it’s all about China. They are the “enemy” and they need to pay for the consequences of COVID.
What was the fallout?
Where do you start? As of the time of writing, more than 25m cases and 848,000 deaths, with cases reported in 188 countries and territories. The US accounts for over 190,000 deaths alone. And still counting.
It’s led to greater divides between the haves and have nots. Millions losing their livelihoods. Black Lives Matter. Anti-vaxxers. Racism towards those of East Asian extraction. A mental health crisis. A harder line with China.
Countries went into full lockdown. Children were forced to be schooled from home. Trillions of dollars were pumped into the economy by the government and central bank. No one expected these consequences of COVID-19.
“Work from home” became a label and then a commercial reality. Everyone’s doing it. UK fund manager Schroders became the first major City of London institution to tell staff they will not be required to return to the office five days a week. When Twitter says as much it’s no big deal. But a blue-blooded banking institution? Things have changed.
Technology became the new black. A zoom call is normal for social and commercial engagement. Apple became a 1 trillion-dollar company. Everyone decides such companies are immune from economic Armageddon and push stock market indices to record highs…for now.
And this is just a sample of what we’ve experienced.
What does this all mean for us going forward?
On August 6, bells tolled in Hiroshima, Japan, to mark the 75th anniversary of the dropping of the world’s first atomic bomb. In August 1945, a US bomber dropped the uranium bomb above the city, killing around 140,000 people. That bomb changed the world. Three days later a second nuclear weapon was dropped on Nagasaki. Two weeks later Japan surrendered, ending World War Two.
What is often ignored are the consequences. The fallout. Thousands of others died prematurely over the years because of radiation-induced cancer, a tally that is still growing. Collectively, they have left an important legacy. Most of what is known today about the long-term health effects of radiation has come out of research with those survivors.
Japan’s wartime experience has led to a strong pacifist movement in the country. Popular culture immediately began to grapple with the bomb’s power. Many films and books imagined a post-apocalyptic world. In Japan, atomic energy created or awakened monsters such as the original Godzilla. Nuclear warfare would fill the heart of the world with fear and regret and would define the decades and the Cold War to follow.
We always defer to the past to predict the future. It’s an easy and simple way to approach the unknown. But we are working with complex systems where many elements are connected, whether you realize it or not. When one falls, it takes other elements with it. This is the charm and curse of unintended consequences. This is relevant to our world. And this is relevant to your career – and whether it’s time for you to leave banking.
We are at another turning point in society. We are still working our way through the fallout. Times have changed in ways that we can see and in ways that are yet to become apparent. We can only imagine what the full consequences of COVID-19 will be. Hopefully, there will be lessons learned.
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