Weathering Perfect Storms – Reflections on the Turbulent Times Ahead
Photo by Patrick Donnelly on Unsplash
While in Beaver Creek, Colorado meeting with hotel staff and management, and other vendors making plans for what we hope will be our annual global event in July of 2021, I had some time for reflection. It has been a sobering experience. In some ways, I feel like I am touring a beautiful, multi-billion-dollar resort destination that is under siege and threat to become an invisible disaster area. While everyone is going about the typical routines of the hospitality industry while following COVID 19 protocol--masks required, social distancing, vigilance about disinfection procedures, etc.--there are less visible signs that everything is not normal or okay.
Hotel management says they are operating without 200 staff members that have been laid off. Everyone is multi-tasking. Their upcoming winter season, their make-or-break financial season when vacationers come from around the world for winter skiing, is dependent upon how many migrant workers can get a J-1 visa to fill the voids in their crews or how many people will venture to get on a plane to travel if the virus is not contained. They worry about what happens if cash flow has crippled their ability to even open. This massive 190-room resort and spa is a part of a group that owns 14 similar properties. They are all on notice that cash flow is a threat to their jobs and future right now.
While Ann and I are pushing forward with planning for that longed-for day when COVID 19 is behind us, we get a call that our son’s girlfriend has suddenly had her collegiate plans upended. A fellow student, who she had proximity to, tested positive with the virus. Although the student is asymptomatic, now an entire group of students must be tested and possibly banned from on-campus participation for the remaining semester, even though they only arrived and moved in a week ago. These are crazy times.
All this has given me a chance to think more deeply about where we are and what headwinds we are facing.
The Pandemic. One word: Confusing. Confusing science, mixed data, and fragmented leadership have created uncertainty as to how or when it will end. This is taking its toll. The CDC reported that only about 6% of the deaths are "from COVID" and 94% are "with COVID." This finding, which suggests that the virus in combination with underlying health problems increases the risk of death, only serves to make it more difficult to know our actual risk. Not only do markets not like uncertainty, neither do people! Fatigue and resistance to submit to protective measures are growing as it continues to derail our lives and livelihoods. Dr. Facui forecasts that we are going to have to deal with this for another 12 months.
The Real Economy. One word: Fragile. Forget the highflying technology beneficiaries of the forced migration to an online existence for a moment. Hard asset industries such as hotels, restaurants, retail stores, and the airline industry are under extreme pressure. The airlines, somewhat of the backbone of our global commerce, cannot survive intact much longer without a return of business and international travelers. Throw in higher education, trucking, manufacturing, and construction… and the risks are enormous. Possibly there will be mergers, acquisitions, and consolidations, or more government intervention that bolster the stronger players, but I see the risk of big chunks of the present economic iceberg breaking off and melting away which creates an unemployment crisis and a vicious cycle of economic destruction. We are close to a depression, which so far has been held back by fiscal and monetary policy.
The Political Environment. One word: Volatile. It takes very little imagination to see that this election could be the most contentious political event in modern times. This Reuters headline makes it clear that money managers agree with me: "US Election Priced as Worst Event Risk in US VIX Futures History." When I study the history of currency collapses, I find three common denominators that must converge: out of control spending, unmanageable deficits, and political instability. In other words, when the world loses confidence in the leadership of those issuing the currency, the fiat money loses its value quickly. Could we be heading there? Is the "good faith and credit of the USA" on the line? Are both parties forced into a cycle of attempting to bail out a wounded economy with more and more fiat money? Will we face political gridlock or worse? No one knows, but we are undeniably entering a volatile period at a critical time.
Finding Certainty in Uncertain Times
My sense is we are possibly in the eye of a perfect storm and God’s wisdom and intervention are crucial to weathering the storms ahead. That is why I am writing this to you. Individual leaders are God’s agents during a crisis, and we need to be like the men of Issachar who understand the times and know what to do.
The Pandemic: Don’t panic should it continue far longer than we expect. That is what the unbelievers will do. Be calm, steadfast in faith. Live in the present. Shed the regret of the past and the anxiety producing fear of the future. I am reminded of the words of Eleanor Roosevelt, "Yesterday is history. Tomorrow is mystery. Today is a gift."
The Real Economy: There will be casualties and there will be survivors. God told Joshua to be "strong and courageous" when nearly the entire leadership of Israel thought he was crazy. The word "strong" addressed his need for emotional strength and determination while the word "courageous" addressed his need to take action in spite of his fear. God’s two word plan was to start marching, one foot in front of the other, towards the Promised Land although it was known to be filled with giants. For you, that may mean, "Persevere and be opportunistic". While we are in a fragile position, we are also resilient. Bring good news when others see only doom and gloom.
The Political Environment: Many outside the United States struggle to understand some of our dynamics, how we have the candidates we have today or why we see this as such a high stakes election. While it is important, remember, it is in God’s hands. He raises up leaders and He deposes them. Regardless of the outcome, be a peacemaker. Hold fast to your convictions but be kind and winsome to your opponents. Criticism, complaining and condemnation only divide. Joseph and Daniel both rose to the highest ranks of influence as exiles in a hostile land and served faithfully under corrupt kings. God used them mightily to save and preserve His people.
That is the work to be done in a perfect storm.