by Gary Alexander

February 15, 2022

Covid entered America in Washington State, where I live – and its last mask mandates may end here, too.

Washington is one of three remaining states requiring mask-wearing statewide in all businesses. Governor Jay Inslee may lift that mandate soon, so allow me a walk down memory lane about how it all began here.

China’s Year of the Rat began on Saturday, January 25, 2020, the day we sailed on our ninth annual Jazz Cruise. Earlier that week, Washington State announced the first confirmed case of COVID-19 in the U.S. It involved a 35-year-old man from Snohomish County who just returned from Wuhan, China. He landed in Seattle on January 15, with a cough. By the time our two-week Caribbean cruise ended, another ship (the Diamond Princess) was in Covid quarantine, so we felt fortunate to make it home safely February 11.

But the next day, the stock market began a free-fall panic reaction to the beginnings of Covid-19:

  • The Dow Jones Industrials fell from 29,568.57 on Wednesday, February 12, 2020, at 3.45 pm to 18,213.65 at 11:45am on March 23, down 4% in 40 calendar days – just 28 trading days.
  • The S&P 500 waited another week to peak. The S&P fell from 3,393.52 at 2:40pm on February 19 to 2,191.86 at 11:45am on March 23, down 4% in 33 calendar days (or just 23 trading days).
  • NASDAQ was the least volatile index, falling 6% from February 19 to a March 23 low of 6,631.

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

Bear in mind that there were no known deaths of Americans from COVID-19 in mid-February, when the stock market began its collapse. Washington State announced the first American death from COVID on February 29. Later, we learned of two more deaths on February 26 due to COVID at a nursing home in Kirkland, near Seattle. (Then, over a year later, some earlier February deaths were belatedly confirmed.)

Through mid-March, Washington State had the highest absolute number of confirmed cases and highest per capita cases of any state in the nation. Most of our Covid deaths came from a Kirkland nursing home (near Seattle), but there were tragedies closer to home. Our community choir stopped rehearsing March 1, but nearby Skagit County’s choir rehearsed March 10. Within a week, 53 of 61 singers (87%) got COVID and two died. After that scare, we basically stayed sequestered on our remote island, a good place to hide. (Our county has seen only one Covid death and we have the lowest incidence of any Washington county.)

While Washington State took early safety measures, officials in New York and New Orleans said it was fine to celebrate China’s New Year or Mardi Gras, so those two cities soon led the nation in Covid cases.

The Folly of Market Timing

As soon as we returned home in February 2020, the market began falling, gradually at first and then like a waterfall. I rode it to the bottom. In the two weeks from March 4 to 18, the Dow fell almost 7,200 points (down 27%). The seven biggest Dow Jones declines of all time all happened in the first half of 2020:

Every investor dreams of knowing exactly when to sell and when to buy back. I’ve never been so gifted. I held stocks through the 2000 dot-com bubble, the 2008 crash, and the 2020 Covid scare. The problem is re-entry. If you miss the bounce, you miss everything. The recovery was a rocket: Up 20% in three days.

By November, investors made all their money back – and eventually doubled their money from the lows.

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

It’s now two full years since I returned from the 2020 Jazz Cruise and the markets began to tank. At first, we stayed home 16 months. Two years of Jazz Cruises have now been canceled, and I’ve only flown out of my home region twice, for investment conferences, and we never sold stocks in panic. How did we do?

I won’t make the easy comparison of measuring from the bottom to the top. I’ll measure from the peak of February 12, 2020, to the low of February 11, 2022, and see how a “buy and hold” strategy worked out:

The lesson for long-term investors is simply to let the market come back to you.

The Face Masks are Coming Off – Fast

Take off that Gloomy Mask of Tragedy. It’s not your Style
You’ll look so good that you’ll be glad’ya decided to Smile

–From “Put on a Happy Face” in “Bye, Bye, Birdie”
Words by Lee Adams; music by Charles Strouse (1960)

It’s hard to keep up with all of the official pronouncements, but the various state Governors are acting like so many Groundhogs, each predicting a clean breath of Spring by mid-March. Last Wednesday, The New York Times reported: “New York’s governor said on Wednesday that she was ending the state’s indoor masking rules. The governor of Massachusetts announced that face coverings would soon become optional in schools. And by day’s end, the governors of Illinois, Rhode Island and Washington said that they, too, would loosen coronavirus rules.” Then the Times added this map – which is already out of date:

On the same day (February 9), Forbes reported that California governor Gavin Newsom announced last Monday that his state’s mask order would end February 15 for businesses, while Connecticut and New Jersey said school mask mandates would end February 28 and March 7, respectively. Also, Oregon said it would lift mask mandates by March 31 at the latest and Delaware already has. (We’re making family bets whether Washington will be last to unmask, or will it be Hawaii, where we may go in late March.)

Now that I’ve finally bought a box of face masks, it looks like the masks are finally coming off – at last.

Let me close with some juke box samples from 1960 – for you music lovers out there. As soon as “Bye Bye Birdie” hit Broadway (on April 14, 1960), Tony Bennett recorded “Put on a Happy Face” (on May 6, 1960) and Jack Jones sang “I’ve Got a Lot of Living to Do” (also from Birdie) on TV (May 14, 1961) in his U.S. Air Force uniform, while still on active duty. Both had a lot of living to do, including the lyricist. All are still with us: Lee Adams is 97, Tony Bennett 95, Jack is 84, and he was on the 2019 Jazz Cruise.

The investment angle here is that when we can finally take off our masks and travel freely, interacting with others without fear, buying and selling with confidence, we can enter into a new Roaring 20s, like the Americans of 1922 did after a pandemic, war, and market crash far worse than what we’ve just seen.

Gray skies are gonna clear up, Put on a happy face;
Brush off the clouds and cheer up, Put on a happy face

            —Tony Bennett singing lyrics by Lee Adams, 1960

There’s wine all ready for tastin’
And there’s Cadillacs* all shiny and new!
Got to move, ’cause time is a wastin’
There’s such a lot of livin’ to do!

                        —Jack Jones, singing lyrics by Lee Adams, 1961

*Since Jack was singing on Dinah Shore’s Chevy show, he switched car brands.

All content above represents the opinion of Gary Alexander of Navellier & Associates, Inc.

Please see important disclosures below.

Also In This Issue

Global Mail by Ivan Martchev
Geopolitics Can Override the Fed – At Least for A While

Sector Spotlight by Jason Bodner
Is It News – Or Just Noise?

View Full Archive
Read Past Issues Here

About The Author

Gary Alexander

Gary Alexander has been Senior Writer at Navellier since 2009.  He edits Navellier’s weekly Marketmail and writes a weekly Growth Mail column, in which he uses market history to support the case for growth stocks.  For the previous 20 years before joining Navellier, he was Senior Executive Editor at InvestorPlace Media (formerly Phillips Publishing), where he worked with several leading investment analysts, including Louis Navellier (since 1997), helping launch Louis Navellier’s Blue Chip Growth and Global Growth newsletters.

Prior to that, Gary edited Wealth Magazine and Gold Newsletter and wrote various investment research reports for Jefferson Financial in New Orleans in the 1980s.  He began his financial newsletter career with KCI Communications in 1980, where he served as consulting editor for Personal Finance newsletter while serving as general manager of KCI’s Alexandria House book division.  Before that, he covered the economics beat for news magazines. All content of “Growth Mail” represents the opinion of Gary Alexander

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