Alon Ozer Discusses Potential Long-Term Economic Effects of COVID-19 with NBC News
As the COVID-19 pandemic continues to bring about economic shock and volatility, experts are beginning to contemplate ways the virus could bring changes to American spending, saving and investing habits for decades to come. Many economists are speculating that we may see the biggest turn to caution since World War II on all aspects of financial life, from home buying to saving for retirement.
To learn more about the potential long-term economic effects of COVID-19, NBC News recently spoke with Omnia Family Wealth Chief Investment Officer Alon Ozer.
“The wealth effect is a major thing in the U.S., especially after a huge run in equity prices,” Ozer told the publication. “The biggest risk – and we saw it in March – is that the fixed income markets, corporate debt mostly, and equities are going to start to move together. All these 60/40 portfolios you hear about, if they move together, you’re going to get decimated.”
Furthermore, investors that don’t have the luxury to wait several years for economic recovery may have to even avoid safe-haven investments, which will make it more difficult for companies to raise cash or issue debt.
“The stuff we see is just staggering,” explained Ozer. “What the Fed has to do is basically continue what they’re doing, but on a larger scale. They have to make sure that credit growth continues. If credit growth in the U.S. contracts, we’re going to have a serious problem.”