The stock market is not the U.S. economy. The stock market is an investment instrument.

Yes, the downstream consequences from coronavirus mitigation efforts means there is likely going to be temporary, very specific, fluxes within the Main Street economy. Entertainment, hospitality and leisure are likely to see the strongest initial impacts. However, as noted by the release of weekly jobless claims the U.S. economy is very strong.

WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits unexpectedly fell last week as employers continued to hold on to their workers. Initial claims for state unemployment benefits dropped 4,000 to a seasonally adjusted 211,000 for the week ended March 7, the Labor Department said. Jobless claims are the most timely labor market indicator. They have declined for two straight weeks.

Economists polled by Reuters had forecast claims rising to 218,000 in the latest week. (link)

The cancellations of large public gatherings, events and venues will have some impact on independently employed workers and ancillary businesses connected to them. That’s the purpose of the extended and targeted administration effort for financial assistance in very specific sectors. However, in the aggregate the Main Street economy is still very strong.

Numerous pundits fail to understand the difference between strong financials in the banking sector (Main St), and the downturn experienced in the stock market (Wall St). Cue the audio visual demonstration:

The stock market is Wall Street, an investment instrument. The banking sector has strong liquidity and is more connected to Main Street. The banks are stable; this is not a financial crisis. Consider this analogy:

You own a modest home with a $200k mortgage. The home fits your needs; you maintain it; you take good care of your home as do your neighbors. All is well. Tomorrow you find out the city council approved a permit for a railroad to run behind your neighborhood. The value of your home drops 25 percent on the news of the permit. Nothing about the home has changed. Everything is just as comfortable for you next week as it was in all preceding weeks. Other than a pending rail line everything is the same. A month later you find out the city withdrew the railroad permit because the railroad company changed their mind. The value of your home returns to where it was before the news of the permit surfaced. See how that happened? Now replace the railroad permit with the coronavirus.

Keep yourself and those you love well maintained.

This too shall pass…

GO PLACIDLY amid the noise and the haste, and remember what peace there may be in silence. As far as possible, without surrender, be on good terms with all persons.

Speak your truth quietly and clearly; and listen to others, even to the dull and the ignorant; they too have their story.

Avoid loud and aggressive persons; they are vexatious to the spirit. If you compare yourself with others, you may become vain or bitter, for always there will be greater and lesser persons than yourself.

Enjoy your achievements as well as your plans. Keep interested in your own career, however humble; it is a real possession in the changing fortunes of time.

Exercise caution in your business affairs, for the world is full of trickery. But let this not blind you to what virtue there is; many persons strive for high ideals, and everywhere life is full of heroism.

Be yourself. Especially do not feign affection. Neither be cynical about love; for in the face of all aridity and disenchantment, it is as perennial as the grass.

Take kindly the counsel of the years, gracefully surrendering the things of youth.

Nurture strength of spirit to shield you in sudden misfortune. But do not distress yourself with dark imaginings. Many fears are born of fatigue and loneliness.

Beyond a wholesome discipline, be gentle with yourself. You are a child of the universe no less than the trees and the stars; you have a right to be here.

And whether or not it is clear to you, no doubt the universe is unfolding as it should. Therefore be at peace with God, whatever you conceive Him to be. And whatever your labors and aspirations, in the noisy confusion of life, keep peace in your soul. With all its sham, drudgery and broken dreams, it is still a beautiful world.

Be cheerful. Strive to be happy.

By Max Ehrmann © 1927