Below is a fictional story about the stock market. Please read it in the animated Jackie Chan series Uncle’s voice.

The year is 2072:

You’re sitting at your front yard sipping coffee from your solar-powered-auto-reheating mug. A magnetic levitating car pulls up like 10 feet beyond you. It’s your grand-daughter Ah Lui.

“Gong Gong! Hou loi mou geen! We’re here to pick you up, are you ready for our annual family space cruise around the moon.”

“Haha Ah Lui, slow down…Gong Gong isn’t young anymore. Gong Gong remembers that back in my time, we used to take cruises in the ocean.”

“Really? Is it similar to a space cruise where you have to go through 3 stages of decontamination chamber before boarding the ship?”

“No Ah Lui, it wasn’t always like that. But ever since the Great Corona Pandemic of 2020, things were never the same again.”

“The 2020 Corona Pandemic? I think I just learned that in my economics class. How was the situation back then? Were people afraid that the economy would collapse?”

“Haha Ah Lui, I’m glad you’re interested in learning about this incident. Lai sit down, Gong Gong have a long story to tell you.”

“It was the year 2020 and Gong Gong was only a young man in his 20s. After the virus hit the majority of the western world, the US stock market took a huge 30% dip in a matter of a few weeks. Panic loomed in the hearts of everyone and unemployment numbers soared!”

gasps

“Wow, what did the governments do Gong Gong?”

“The governments of the world implemented policies unprecedented at that time. Trillions and trillions of dollars were introduced into the market to prevent the collapse of the economy. Bailouts were everywhere!”

“Hmm, won’t that just encourage reckless behavior among companies in the future?”

“That is the general sentiment among the general consensus but unfortunately the common folks have no real say on what the Feds can do. And at that time, the Feds deemed this a necessary action to take. They even announced that forsaken term.”

“What is it, Gong Gong?”

“Unlimited Quantitative Easing.”

“Wait they didn’t! They can’t do that right? It will just cause massive inflation according to what I’ve learned.”

“Haha Ah Lui, you must be paying attention in class. That was what everyone thought too. But somehow inflation works in unpredictable and mysterious ways. There was no production growth in most sectors of the market but somehow the stock market started recovering and there was little to no inflation elsewhere!

The common folks were confused and constantly called this strange incident “bull trap” and “dead cat bounce”. Day by day we see the stock market go up without any reasonable explanation. Every week the unemployment rate increased by a few million and yet the stock market kept recovering.”

“Wow Gong Gong, the Feds must have printed a lot of money!”

“That they did Ah Lui, that they did. What people got wrong was that the stock market did not have another drastic drop. In fact, the stock market recovered to its previous year high and continued to fluctuate till the year-end.”

“So there wasn’t a second dip in the market?”

“Ah Lui you have to be patient for the story. The drop came, but not as everyone expected. The second drop came gradually and it started happening right when the coronavirus was under control. When businesses started opening, that was when the stock market started dipping a little. However, it did not dip as much as most people expected. Before 2021 ended, the stock market already surpassed its 2020 high.”

“Gong Gong that doesn’t make sense. Aren’t there millions of people without a job? How is the economy surviving?”

“You see Ah Lui, when the economy opened, the smart businesses with the resources implemented measurements to regain the public’s trust in them. Restaurants started fitting negative-pressure rooms to prevent infections, airlines started offering face shield and disinfectant spray before boarding, gyms started offering online instructors, colleges operated at a larger capacity with online classes and so new innovations in the economy was born. In a way, the coronavirus was a reset button that allowed innovative businesses to capture more market share and wipe out the ones that do not adapt. As some businesses die, new ones emerge and hence the stock market never had its big second dip.”

“I see Gong Gong, I guess humans really are a creative bunch, they just need some help to get them through the pandemic. But what about the millions of people unemployed Gong Gong? How did they survive?”

“Ah Lui you see, the pandemic was not just a reset button for nature, but it was also a wake-up call to politicians around the world to reevaluate their policies. During the coronavirus pandemic, governments around the world introduced direct payments to its citizens that are pegged to the minimum income for a person to survive. So in theory, a person does not need to work for a basic income.”

“Wait but how many people were unemployed?”

“My memory is a little rusty but if Gong Gong remembers correctly it was about 16%”

“Wait but that is a similar percentage to now! That can’t be too bad right?”

“Yes, Ah Lui but you see back then people were not familiar with the concept of Universal Basic Income. The pandemic shifted politicians to actually seriously consider it and after a year of discussion, the bill for basic income was passed and the rest was history. And the government did this by introducing a Value Added Tax to giant corporations that were avoiding income taxes for years! In a way, the pandemic made us question our previous notions of a functional society.”

“So people before 2020 tied their worth to society based on their income? Wow, that’s kinda sad.”

“Well Ah Lui, you see back then it was a normal thing to do.”

“I’m glad we have a basic income now! Sometimes a role in society does not produce any economic output but contributes greatly to society. Like how mummy quit her career when I was young to take care of me. She did not earn any money but she certainly taught me to be who I am today!”

“Wah my Ah Lui sure is so smart.”

“So I guess the coronavirus was a great lesson to us all huh?”

“Yes Ah Lui, it was an event Gong Gong will never forget. From then onwards, Gong Gong learned that you can never time the market and it’s hard to fight against human ingenuity and the combined collaboration from the smartest economist and governments in the world.”

“Wow, Gong Gong that is a great story. I bet I can ace my economics exam now!”

“Haha but don’t forget to study about the economic recession of 2037 and 2045 too!”

“I will Gong Gong! Oh look at the time, we should be heading to the shuttle launchpad soon.”

“Ah Lui not so fast, remember to disinfect your entire body with the UV body scanner and put on the anti-bacterial suit.”

“Aww Gong Gong that’s so annoying, you’re always so loh soh.”

“Ah Lui ah Ah Lui, you have no idea how the world has changed.”