Hardly a day goes by without someone asking me about how stocks can go higher during a pandemic. The chaos is so palpable, the case numbers so terrifying - they just doubled in 10 days - that it has to be catastrophic for the companies. Therefore the market must be propped up, they say, or it is all fiction.
As someone who spends most of his time prepping and then interviewing CEOs, I have come to a different conclusion. I think that it seems chaotic if not apocalyptic because Washington is making it that way. Sure it's a terrible illness. Yes, we are right to fear it, but the truth is that when you speak to Ford Motor's (F) Jim Farley, or the two CEOs of Sysco (SYY) and Cisco (CSCO) , Kevin Hourican of the food kind and Chuck Robbins of the tech variety, you know that they have spent a huge amount of their time trying to assure that their workers are safe. Maybe it's because they will lose a lot of money if they have to close - Ford shut down several plants when workers tested positive this spring and it was very costly. Or perhaps because they are thoughtful, resourceful CEOs who follow protocols and understand consequences. No matter, they are simply far more organized than the government, especially the agencies that are responsible for worker safety, like the now toothless OSHA.
Now I watch my twitter feed and I have noticed that whenever I invoke the president I am greeted with people who swear they will never watch me again. But if you don't mention that while there is a raging pandemic, the president seems to do nothing but tweet about the election and that is hard to reconcile with reality. It's his bizarre behavior that magnifies the gulf between the government and business.
The CEOs do not have that luxury. Unlike the president, they have accountability and, yes, they have a plan. We have no plan.
Now it is not just Washington. The state of California will not let Disneyland (DIS) open even as the company has proven at its other theme parks that it is capable of running them in a fashion that public health officials suggest, including operating at 25% of capacity. I know the pandemic is roaring through California but it does seem like the government is panicking while the company is acting rationally.
Of course, once again, the small and medium-sized businesses are so strapped that they struggle to stay in business. No, safety isn't taking a vacation at these companies, but it is safe to say that if you work at one of them you, too, are marveling that the stock market is going higher. Larger companies just tend to have more resources and are able to call in experts to get it right.
When the book is written on this era, I think we are going to come to realize that business, is, indeed, the greatest platform for change, not the government, and the contrast is so great that it blinds you to the publicly traded positives. Whether out of profit or out of heart, or both, business deserves credit for a lot of this rally, a rally that's happening despite the government, not because of it.