Clare Pelzel
As you have seen, the Coronavirus has been shutting down events, school, and even entire communities because of how fast it has been spreading. Killing thousands of people already, the Coronavirus is the largest pandemic of the century. Along with causing deaths around the world, this virus is taking a toll on the world economy. The Dow has been dropping faster daily than ever before on record by losing almost 2,000 points in one day and 12% this past week (CNBC).
The Dow Jones Industrial Average, the Dow, is an indicator of how 30 large, U.S. listed companies have traded during a standard trading session (investopedia). The Dow is a stock market index which provides a single measurement for how the economy, as a whole, is progressing for that moment in time. This helps people track how the stock market as a whole is doing at a glance instead of having to track all markets separately.
A major cause of the large decrease in the Dow was Trump recently put on a travel ban to all European countries to protect American citizens from contracting the Coronavirus(New York Times). While the travel ban keeps us safe, it hurts the economy. Because of the travel ban, investors are less likely to buy stocks in airlines and other traveling companies. Nobody is going to be traveling, so the airlines aren’t going to be making as much money which means the investors wouldn't make much money, so those stocks aren’t bought; thus creating a domino effect. This domino effect is shown through the Dow which is how it dropped 2,000 points in one day and 12% in one week.
Works Cited
Foimbert. “The Dow Lost 12% in One Week. Here's Why and What Likely Happens Next.”
CNBC, CNBC, 29 Feb. 2020,
www.cnbc.com/2020/02/28/the-dow-just-lost-12percent-in-one-week-heres-why-and-what-likely-happens-next.html.
Seth, Shobhit. “What the Dow Means and How It Is Calculated.” Investopedia, Investopedia, 29
Jan. 2020,
www.investopedia.com/articles/investing/082714/what-dow-means-and-why-we-calculate-it-way-we-do.asp.
“Travel Limits, Economic Fears Stoke Market Plunge.” The New York Times, The New York
Times, 12 Mar. 2020, www.nytimes.com/2020/03/12/business/stock-market-today.html.
This was a very interesting article. Everyone is so cought up on the health issues of the disease and not what else it is affecting so this was very educational for me. You also did a really good job with choosing such a relevant topic. It really surprised me as to how much the corona virus has affected our economy. Since Trump put in place the travel ban, do you know how long it is going to last for? Overall you did a really good job with this article!
ReplyDeleteI really liked reading this I think it is just nice to read something relevant and not a continuous look on renting vs. buying you know? Although all this information in valuable, articles like this need to be written. People need to read and see the affects of this virus.
ReplyDeleteBefore reading this article I didn't have the most clear understanding of what Dow Jones was, thank you for that. Why aren't people buying cheaper airline stocks right now?
ReplyDeleteThe effects of this virus is honestly more scary than the virus itself in my opinion. The effects it had on travel might weaken the economy, but perhaps action should be taken to lessen the amount of people that will be infected by this disease.
ReplyDelete-John Maki
I thought this article was very informative and helpful for anyone thinking of investing right now. Since the corona virus has put a halt on the economy, most stocks are at an all time low for the year. Seeing this in the news can be scary but stocks will eventually rise up and this is best time to buy. However; I do agree with you that people should stay away from airline companies as their businesses are being stopped for the moment. Overall, this was a great article to inform people of what's going on in the investing world.
ReplyDeleteIt is really interesting to see the way our lives change in the instant of this giant outbreak. As you mentioned, the DOW is a great indicator of how well our economy is doing. Clearly, corona virus is hurting the United States economy. Trump must implement some sort of expansionary fiscal policy, as congress is currently discussing, he said he would sign off on anything passed by congress. This way, we will see how effective expansionary fiscal policy is when tested by a struggling, receding economy.
ReplyDeleteI knew this would have effected the economy but however, I would be lying if I paid much attention to it. Personally I have been focusing on the health side of this pandemic and not the economic side. I am astonished from these results, its baffling how the economy can be affected. I thought that the economy would just be on "freeze" and the numbers would stay stagnant. I wonder if the economy would have a surge once the social distancing is over or would the DOW results be subpar in comparison then what it use to be?
ReplyDelete-Han
Similarly, I don't think us kids are really paying attention to how the economy is being effected, as we really have little to nothing invested in it. My parents, on the contrary, aren't having the best time. Although we aren't really effected by the freefall of the DOW of other markets, I think we could maybe pay more attention to other factors that are going downhill besides just public health.
ReplyDeleteI think that with a better understanding of the DOW, we as consumers can better understand how this is truly affecting the economy not only in the United States, but the world economy. I think that there is more than just the factor of public health that is affecting the DOW, but I do agree that public health is a big part of this.
ReplyDeleteBefore reading this article, I was not so sure what the Dow did and how it was affected by the likes of the virus. I would always see it, and never know what it was, but it was good to see and now know, what the Dow does and how it is affected.
ReplyDelete