Analysis of the financial and economic crisis of 2020 seen by the inside of a private bank, and how to get through it

We are currently facing one of the biggest crisis in history. However, this crisis is quite different from the last one since not only financial issues are at stake now. Everyone considers the Covid-19 and the non-agreement between the members of the OPEP and Russia on the production of petrol as the main factors of this crisis. However, some other people, like Georges Ugeux, the ex-Vice-President of the New York Stock Exchange, already warned in 2018-2019 on the possibilities of a major financial crisis before the end of 2020. He accused the public debt of the countries. In his opinion, the Central Banks were lending too much money and too easily to countries like France, Italy, United States or Japan. The global public debt was of 164 trillion in 2018 . This brings a reduced recovery margin. If we follow his thinking, the Coronavirus is only the trigger element of the crisis. This crisis is leading towards major financial, economic and social issues. Major crashes on the stock exchanges all over the world led investors to quickly sell their positions, thus creating an even bigger fall. Economically it is a disaster in more or less every sector. The aviation and tourism sectors are the most affected by the crisis with a drop of 60-70% of the aerial traffic and about 1 billion euros of loss only for the months of January and February in Europe for the tourism sector. Now other industries, like the automobile industry, are also struggling with the closure of all the factories deemed non-essential to the life of the communities. There are also huge social problems; in many countries, kids and adolescents cannot go to school anymore. Even though professors are trying to continue their education from home, this may lead to a drop of the level of education. Moreover, the unemployment rate is becoming enormous in several countries at the image of the United States. The same country that reached an unemployment rate of 3.6% in April 2019, the lowest since 1969 (3.5%), is close to reach 30%, one year after. How can an investor limit the loss or even gain from this crisis, since when there is an important crisis, a big rebound often happens afterwards? Different behaviors are possible to overcome the crisis: betting on companies that will be able to maintain the payment of the dividends thanks to a high liquidity, betting on historical companies that can be purchased at a minor price than usual, investing in new companies who can be the future... Obviously, the bond market can also be interesting. The tactic of the 60/40 portfolio (60% of bonds and 40% of stocks) may have its revenge after years of performance under the portfolio with a major part of stocks. In addition, we can question the utility of the graphical analysis and all the mathematical models for the prevision in such a volatile market. An analysis of the information, the governmental and global decisions, and the sanitary situation may offer a better vision of the future. An investment on the value, like the one described by Benjamin Graham, is probably the best solution in such times…