There are dark clouds looming on the horizon as reports show the large-scale spread of the novel coronavirus, named COVID-19[1], out of Wuhan, China. As it stands, there are an estimated 400,000 cases globally[2], 33,000 of which have been in the United States[3]. The World Health Organization has officially declared it a pandemic[4]. Accordingly, travel restrictions have been put in place to varying degrees across the globe, and people in the most affected areas have been told to stay home and avoid crowds.

Therefore, it shouldn’t come as a surprise that the world economy has been severely affected—a situation that will likely only get worse as the virus spreads. Last week, all three of the major stock market indices entered bear market territory[5]. In addition, with globalization making economies today more interconnected than ever, companies are already feeling the effects as the world’s factory, i.e. China, puts its cities on lockdown. Consumer demand is on the decline in the hardest-hit countries for certain goods, especially luxury items. Even supply issues are popping up in many communities as people rush to stock up on essential items such as groceries, toiletries, and medical supplies. And it’s not just the decrease in spending that is hurting companies, but also the disruption to global supply chains. For example, auto companies such as Volkswagen, Toyota, General Motors, Honda, and Hyundai have had to pause operations in China, and carmakers there will lose about 15% of production in the first quarter of 2020[6].