The Trifecta

A trifecta in horse racing is when you accurately predict win place and show. It is when you get three bets correct.

We’ve had the opposite happen in 2020. We’ve had three things go wrong at the same time.

As my friend David Steinberg said to me last month, we are witnessing 1918 (pandemic) plus 1933 (economic crisis) plus 1968 (racial crisis) all at the same time.

Of course they are related. The economic crisis was brought on by the pandemic. And the racial crisis has been made worse by both.

At some point, the pandemic will ease. I am hopeful that behavior change (mask wearing, social distancing, self quarantining, etc) combined with rapid and inexpensive testing will help contain the spread of the disease while we wait for the therapies and vaccines which will eventually irradicate it.

But when the pandemic is over, we will still have the economic and racial crises to reckon with. And reckon with them we must. The financial markets suggest that the reckoning will be easy and painless. I’m less sure of that.

As I wrote about a few days ago, our public sector budgets have massive holes in them. The inequities that have come to the fore in the racial crisis cannot be swept under a rug. I believe we are in for a lot of change and a lot of pain in the wake of this trifecta and there is no escaping it.

I also believe, as I wrote last week, that this painful period of change can lead us to a better place. But that will take time, energy, and capital to achieve and it won’t come easy.