Running a small business is very different from being the CEO of a publicly traded company in myriad ways, but in a crisis, those differences become severely magnified. The President’s initial response to the growing fears over coronavirus was to obsess over the stock market and scream for lower interest rates. Which did not help to stabilize the stock market, as I said they wouldn’t. This was my take on the Fed’s ill-timed “announcement” Tuesday:
So now you’ve got the first emergency 50 basis point rate cut since the fall of Lehman 12 years ago. And now, as then, markets continue to fall as Fear takes the wheel from Greed. And if you believe, as I do, that asset prices – stocks and real estate – are the primary drivers of the modern economy, then this will take some time to work itself out. I am 100% confident that the US economy will rebound from this challenge, but also 100% confident that the markets will overreact to it, which is part of the process and should be expected.
But small business owners are being hit by more than just confidence issues. They’ve got to contend with the possibility of self-quarantines, shelter-in-place orders and the general disruption of shopping and commuting and gathering that could take place for awhile.
The guy who sells coffee in the store beneath my train station could probably survive a week of no customers, but two weeks? Three? How does he keep his staff paid? How does he pay his bills? Now multiply that by millions of businesses that rely on people being out and about, not just ordering snacks from Amazon and watching Netflix til the crisis passes.
So that’s who I’m thinking about.
Running a small business means always operating at the razor’s edge, even in normal times. One sudden expenditure or accident could cost you a whole year’s worth of profits. Where is the White House’s plan to back up small business owners and their employees in an emergency situation? Is anyone even talking about it?
Here’s what I said on MSNBC yesterday: