by William Skink
This country is not ready for what’s coming.
A decade of central bank intervention to prop up financial markets with low-interest liquidity is going to be undone by the Coronavirus. Wall Street is finally waking up to this harsh reality, and you should to.
A myriad of systemic flaws will be exposed by the global grip of fear and panic now taking hold. Globalized supply chains are already being disrupted and the transportation sector will be hit hard. Then there’s our lovely health care system…
Here in Missoula, the economic pain will start being felt as the weather warms and tourists don’t arrive in droves like they normally do.
Missoula’s economy, like the nation’s, is a house of cards. All the bonds passed in recent years to fund parks, schools and a spanking new library are predicated on continued economic growth. What if that growth is halted by the Coronavirus?
At the end of January, this is how the economic outlook for Missoula was being reported:
“The biggest contributor to overall growth has been expansion in the local economy’s finance and business services industries, which reflects strong tech growth as well as financial institutions serving residential and commercial real estate markets,” Barkey said.
That means booming Missoula tech companies like Cognizant-ATG, Fintech and traditional lawyers, accountants and engineering consultants, fall under those two main categories.
Barkey said the trends will persist as Missoula continues to outpace the state.
“Looking ahead, we expect to see a continuation of growth exceeding the state average, winding down a bit as the pace of the economic expansion cools in the coming years,” he said.
I don’t expect to see a sunny economic forecast like this again in my lifetime.
Over the decades Missoula has transformed from an extraction economy (mostly timber) to an economy that relies heavily on tourism.
Public money has been used to bring hotels downtown. The airport is expanding to bring more tourists in by air. The argument for a gas tax and/or a sales tax is based on it snatching money from those precious tourists who are supposedly going to help dig us out of the housing crisis we are in.
What happens if the tourists don’t come?
Using myself as an anecdotal example, there is no way I’m taking my family on the summer trip we had been planning to Washington State. And one of my co-workers is cancelling their family trip to Disney Land. How many people like us are cancelling trips?
I’ve also been thinking about how the Coronavirus will most likely come to Missoula, if it’s not already here. My thinking is along the lines of what types of populations are mobile. I’m explaining my thought process because what I’m about to say might be controversial.
I think either the seasonal transient population and/or the wealthy vacation home population are the two most likely types of people to spread Coronavirus to our community.
I am not saying homeless people are diseased, let me just state that as clearly as I can. The seasonal transient population is a small subset of the larger population of those without homes. Like the very wealthy, they are not as tied down to a geographic location.
However it arrives, if and when it does, prepare for an increase in irrational behavior.