David Shapiro on ‘crazy markets’: post-Covid economy will be VERY DIFFERENT

Covid-19 containment has forced many businesses to shut their doors forever. The full extent of the damage is not known, but estimates are depressing. Tourism Minister Mmamoloko Kubayi-Ngubane warned last month that up to 600,000 jobs were at risk in that sector alone. The central bank expects the South African economy to have registered a contraction of at least 30% in the second-quarter. Stockbroker David Shapiro and BizNews founder Alec Hogg discuss the crazy markets in the light of the changes Covid-19 has wrought on businesses. The signs are there that the market is telling us that the Covid-19 economy will look very different. – Editor

Lovely to have you, David, as always. Is it a worthwhile stock market at the moment? Mr. Shapiro.

Crazy. Absolutely crazy, but I'm going to live with crazy sometimes. I'm not going to try to talk it down. Today, the move is coming from China. I haven't heard a convincing explanation of why it is as strong as it has, but it's gone through to the rest of the world as well. We've got a very strong Europe, we're going to have another strong session in the US. It comes at a time where there's so much political speech about or political rhetoric about the US election, Covid there is increasing at a rapid rate, in fact, globally it is. We're still struggling to understand how long it's going to take for the global economy to unlock, how long it's going to take us to get back to normal. Markets seem to brush aside and I think driven by liquidity, people buying equities. We heard at 08/09, we heard the liquidity story, and it continued for 10 years. I'm hoping this continues for another decade because I haven't got that many decades left. I want to end up on a high.

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