We created three vignettes of potential futures for our experts to react to. This is the Goldilocks vignette — not too horrible, not too great.
We get some of the science right, and some of the stimulus investment right. We also get some of it wrong. The results are mixed. The recovery is slower that it could be, but in the end, we recover. We’re not forecasting than this timeline is in some way the “middle, and therefore likely” one. For our editorial purposes here, it’s just as plausible as the rest.
Testing
Testing continues to be sporadic. The “states are in charge” approach yields a patchwork of coverage as states compete with each other for supplies. This, coupled with the uneven opening of businesses, means that shelter orders are extended or reinstated in many areas and the virus continues to flare up in hotspots around the country. People are eager to get back on track and frustrated and anxious as many states cancel summer programs for kids and hint that schools might not reopen in fall.
Regionalism
The economy in many sectors stays closed for longer than many want, but untold lives are saved. This is largely due to a failure to generate enough trustworthy testing kits to allow for people to trust that “it’s safe to come out.” Much like China’s early attempts to open its economy, just because businesses were open in some places didn’t mean that people would come. But none of this is universal as some customers are happy to return.
The federal government, continuing trends from the beginning of the crisis, rewards states that are loyal with tests and stimulus money and punishes those that try to stay closed to flatten their own curves by withholding federal aid. This leads to tension among the states, including expansion of border checks for travelers. Interstate business travel fails to rebound as state cases slow at unequal rates. People restock in preparation for a return of lockdowns in the fall and settle in for what looks to be a long recession.
Employment
Many bars and restaurants and other small businesses have been closed too long and can’t reopen. Government stimulus fails to revive them directly but the bailouts to financial services are used to jumpstart new businesses. This, however, is a long-term return to pre-crisis levels and a recession with high unemployment drags on. With the continuation of social distancing in many regions and the re-closing of some that opened too early without proper testing, more and more goods and services wind up being moved to online or BOPIS. There is a large shift in service workers from their previous jobs (in hospitality especially) to gig-economy delivery jobs with low wages and few benefits. But high unemployment means they have little power to bargain or organize for better rights.
Stimulus
After two large rounds of stimulus, Senate leader Mitch McConnell begins talking about the debt as a “serious issue” and talks bog down on any further stimulus. Money continues to be doled out with little oversight. In the end, $3 trillion+ leads to some short-term patches for the economy but the federal government is tapped out before much aid flows to cash-strapped state and local governments. This contributes to the prolonged recession. Uncertainty is the new norm for Americans who continue to see brief hopes dashed by political and social realities.
Elections
The elections are bumpy. The Republican Party, which has long raised the specter of voter fraud, continues to ramp up this rhetoric leading up to the election, causing fears that the results will be contested. Indeed, there are numerous accounts not necessarily of fraud, but of intimidation and irregularities due to the unprecedented volumes of mail-in ballots. Once the ballots are counted, the results are clear enough that both sides accept the outcome.
Here’s how experts think this might affect the finance industry.
Matt Carmichael, Editor, What the Future | 
@mcarmichael