Carrot Cake 5-19-20
second & third order effects
*Confession: I still don’t really know the difference between effect and affect.
This week’s topic: Second and third order effects of the coronavirus pandemic.
This topic was sparked by the most recent Prof G Show podcast.
First order effects: Example: Zoom and Peloton will continue to smash it. These are the more obvious things that are easy to predict. It’s too late to get in on the action. We missed it (unless you loaded up on stock).
Second and third order effects: Prof G predicted two migrations. One, a return to public schools. With remote learning, if students are going to get a similar experience, why not save tens of thousands and put your kids in public schools? Second, if you don’t need to be in an office, move to Florida and pay zero state income tax. Give yourself a 15% raise just by living in a different state. I’d love to hear your thoughts on these. Would you consider moving? Have you ever seen what 400k can buy once you look outside Boston, NY, etc?
The second and third order effects are harder to predict and can be potential opportunities to take advantage of trends that not everyone can see.
Here are a couple thoughts:
2022 will look exactly like pre-covid times. I think “the new normal” is going to be short lived. Life will look different for the next 12 months, but I predict a slow creep back to the way things were. People will be back in packed office buildings, yoga classes will be full again, schools will return to normal.
I think contact-less transactions are here to stay. Grocery delivery and buying cars without visiting a dealership are being forced on people. If the experience is any good, people might say, “why would I ever go back to the old way?” There are huge implications for salespeople here also. Maybe this kills the travelling salesperson. If a prospective buyer can now do all of their evaluation work remotely without in-person visits and sit down dinners, will they want to go back after this is over? I say no. Especially as 30 year olds start to get more influence at their companies.
Here’s a call to action. Send me one prediction based on your field of expertise. What’s going to happen? What trends are hiding around the corner that we can all benefit from?
Love you guys, hope you are well.