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Market Perspective: The Ride Back to “Normal”

July 6, 2020
Ashish Jain

Ashish Jain, head of capital markets at C2FO, equates the path to economic recovery with the dramatic twists and turns of a roller coaster. 

As we head into the mid-summer months, there is a dash of optimism in the world economy. With a larger number of cities and states moving further into their reopening, businesses are adapting and eager to understand what “back to normal” means in this recovery.

Have we reached peak normalcy? No, and that won’t be the case for at least the next six to 12 months as the effects of the COVID-19 pandemic reach the far corners of our global economy. 

However, we’re certainly seeing significant acceleration in the rate of progress towards normalization.

Thinking back to simpler times, I took a trip with my family in mid-February to Disney World. This was my first time ever at the theme park, and we split four days among Disney’s Hollywood Studios, Magic Kingdom, Animal Kingdom and Epcot.

On our first day, we went to Disney’s Hollywood Studios. I read in advance about the crowds, but nothing could prepare me for seeing those lines. Now, I’m not a fan of roller coasters (both literally and figuratively) but my four-year-old was itching to ride Slinky Dog Dash in Toy Story Land. With the theme centered around Toy Story, I thought the ride would be tame — a “kid” coaster. 

 The moment the ride started, I thought to myself, “What kind of kid’s roller coaster is this?” I closed my eyes, held onto my son with one hand and squeezed the bar with my other hand as hard as I could, screaming at the top of my lungs.

After about a minute, we slowed down and I thought with relief, “Finally, this is over.”  But then we took off again, and I was begging to be let off. Eventually, we slowed and came to a stop.

My son was beaming. 

A thrill ride economy

Similar to my experience, each of our days lately can seem like a roller coaster ride. COVID-19 has created an endless stream of raw emotion each day — fear, anxiety, exhilaration, frustration and even joy. 

And just like a roller coaster, the economy will ebb and flow — with the highest of highs and the lowest of gut-wrenching lows — as we continue to reopen. 

There are encouraging signs that the economy is normalizing, like those noted in a June 24 research report from Goldman Sachs. 

The chart above looks a bit like a roller coaster, representing the progress of the economy from February 3, 2020 to June 15. It’s a composite scale that Goldman Sachs created to monitor the reopening of America, using a wide range of data across the categories of  “Stay-at-Home” (food delivery, eCommerce, streaming media, grocery sales) and “Back-to-Normal” (commuting, box office, travel).  

Some of those notable shifts towards normalization include: 

Healthcare utilization 

Hospital volumes are recovering. A report by Tenet Health, a hospital system with 65 facilities, notes admissions were about 90% of pre-COVID levels in the first half of June, up from about 80% in May and about 33% in April, driven by a return of hospital surgeries. 


OpenTable released dining room capacity data for restaurants that have reopened, which shows U.S. dining room capacity running at about 61% over the past week (up from 57% the week prior). Goldman Sachs’ data shows casual dining capacity has now reached nearly 55%, up from 48% last week and 40% in the prior week. 

Streaming video 

According to Nielsen data, the amount of time people in the U.S. spent streaming video peaked at 170 billion minutes the week of April 6th, and is now back to pre-pandemic levels of 126 billion minutes, although still up roughly 50% year-over-year. It’s an indication that people are spending less time locked down in their homes than they were a few weeks ago.


TSA passenger volumes have recovered to 80% year-over-year as the number of passenger aircraft in service tick up to 41% year-over-year. 

Home buyer demand

On a regional level, Redfin noted this week that homebuyer demand has been recovering in nearly every city, even those worst hit by COVID-19. The strongest comeback was in Detroit, which saw homebuyer demand increase 58% compared to pre-pandemic levels even as the April unemployment rate in the city was about 25%. Seattle, San Francisco and Boston are also seeing strong housing demand, compared to softer growth in New York, where many people are looking to move away from the city into the suburbs. 


Retail saw a stronger than expected recovery in May. Core retail sales year-over-year growth accelerated to 0.6% in May compared to negative 11% in April. More specifically, apparel sales shot up 188% from April to May, while auto parts sales increased about 25% in the same time period.

Riding the highs (and the lows)

The Goldman Sachs U.S. Reopening Scale, first reached “1” in the week of March 16th, where it remained for 10 weeks, indicating that consumers were still in the trough of impacts from COVID-19. However, the week of June 15 through June 22 reflects the recovery of consumer behavior and supports the Reopening Scale at “2” for a third week. 

According to Goldman Sachs, we should not expect a full recovery to “10” for many months. The roller coaster recovery will likely moderate as people resume daily activities of dining, commuting and travel.

Despite my experience at Disney World, I’m not permanently distraught from the Slinky Dog Dash ride. I’m even eager to go back to Disney World, though you probably won’t see me on Tower of Terror anytime soon. 

This roller coaster we’re on — one that C2FO is riding alongside our clients — will be tough. It will last months. But as we ride the highs (and lows) of our new reality together, we’ll come out the other side a little dizzy, but we’ll be stronger because of it. 

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