New Year 2021, Looking back on 2020
Jan. 3rd, 2021 04:42 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
canyonwalkerEvery year around the New Year I reflect upon the past 12 months. This year it's challenging to write about. I could just observe, for about the billionth time, that 2020 was a total dumpster fire and be done with it....
But to stop there would be taking the easy way out. Over the years I've found retrospective writing is helpful both to strengthen my own recollection years later as well as to structure and sharpen my thoughts in the present. Thus even though 2020 was a year almost anyone would be glad not just to close the book on but slam it shut, I'll write about it for better understanding.
In the past I'd wondered if something could happen that's so overwhelming it's headline news in every category simultaneously— politics, money, health, life, entertainment, sports, etc. In 2020 exactly that happened.
I'm talking, of course, about Coronavirus. It's affected literally every aspect of human existence in 2020. And generally not for the better. 85 million people have been sickened worldwide and nearly 2 million have died (source: worldometer Covid-19 pandemic, retrieved 3 Jan 2021). Those figures are widely considered an undercount, BTW, especially the deaths figure. Billions of people have been under varying degrees of stay-home orders for the past 10 months, disrupting education and many sectors of the economy. Businesses are failing for lack of revenue and unemployment is markedly higher.
While it can be tempting to say, "2020 sucked because of Coronavirus" and leave it at that, that's oversimplifying it. When I write these year-end retrospectives I like to examine the year through different lenses. ...Even if, for 2020, all of those lenses have been tinted by this one story.
Hawk's job situation is going better than mine. She had no pay cut or furlough this year. A promotion she was angling for a year ago didn't materialize, but she may have another chance this coming year. At least her executives support the idea that she's on a growth path.
The chart above shows the S&P 500 Index, an amalgamation of the stock prices of the 500 largest US companies, from 1 January to 31 December 2020. As you can see in the shape of the curve, there was quite a drop— a market panic— in late March. I remember the broad markets dropping 10% in a single day— at least twice. But after a few weeks of bloodletting the recovery began. By August the index was back to even with where it started the year. By the end of the year, after a few smaller ups and downs, it finished up 16%. (You can see the actual numbers in the small print in the pic. The index began the year at 3234.85 and ended at 3756.07.)
Now, I've written before that The Market Is Not The Economy. Well, the Index is not the Market, either. Because of the way the S&P 500 index is weighted most of the apparent gains it shows are from the 10 or so hugest companies at the top. For those "mega-caps", heavily weighted toward the modern tech sector, 2020 has been a banner year. For the other 99.8% of the market it hasn't been so sweet. But even so, most market sectors are up for the year. My portfolios, which in the depths of March were down over 20% from January, finished the year up about 10%. That, surprisingly and pleasingly, keeps me on track with my long term financial goals.
As we close the book on 2020— or slam it shut— it's tempting to think how much better 2021 will be. And probably it will be better. Coronavirus vaccines were developed in record time (not actually surprising in light of the science behind the development but still historically fast) and are now available. As they roll out across 2021 we may not vanquish Coronavirus but should at least beat it down that life can largely resume pre-2020 normality.
But there's no guarantee! If there's anything 2020 has taught us it's how thin the ice beneath us is. For example, what if there's a serious stumble with the distribution or efficacy of the vaccines? What if the virus mutates? What if there's another Black Swan crisis entirely unrelated to Coronavirus? At any moment, in any place or fashion, the ice beneath us could crack and plunge us into catastrophe.
Thus I count my good fortune where I can, give thanks for what I have, and stay careful about how precarious the good life is.
But to stop there would be taking the easy way out. Over the years I've found retrospective writing is helpful both to strengthen my own recollection years later as well as to structure and sharpen my thoughts in the present. Thus even though 2020 was a year almost anyone would be glad not just to close the book on but slam it shut, I'll write about it for better understanding.
A Singular Story Defines 2020
It turns out to have been ironic that the dumpster fire meme originated in 2016. The events of 2016 we all thought were so horrible were dwarfed by what would come four years later.In the past I'd wondered if something could happen that's so overwhelming it's headline news in every category simultaneously— politics, money, health, life, entertainment, sports, etc. In 2020 exactly that happened. I'm talking, of course, about Coronavirus. It's affected literally every aspect of human existence in 2020. And generally not for the better. 85 million people have been sickened worldwide and nearly 2 million have died (source: worldometer Covid-19 pandemic, retrieved 3 Jan 2021). Those figures are widely considered an undercount, BTW, especially the deaths figure. Billions of people have been under varying degrees of stay-home orders for the past 10 months, disrupting education and many sectors of the economy. Businesses are failing for lack of revenue and unemployment is markedly higher.
While it can be tempting to say, "2020 sucked because of Coronavirus" and leave it at that, that's oversimplifying it. When I write these year-end retrospectives I like to examine the year through different lenses. ...Even if, for 2020, all of those lenses have been tinted by this one story.
Personal
For myself and for my immediate family the story of 2020 can be summarized by three terms: Adapting, Making Do, and On Hold. We've adapted fairly well to the changes required by the global pandemic. My job was already largely work-from-home; now it's 100% WFH. Our habits of eating out frequently were surprisingly easy to change to cooking at home 90%+. We're traveling way less, which is a disappointment. Health-wise we've avoided Coronavirus.Jobs
My job situation has been "meh" overall. In April I had a 10% involuntary pay cut that was restored in August. But hey, at least I've had a job consistently. That's more than I can say for some people. Too bad my job's still pretty much a dead-end job. But hey, at least it's a fairly well paying job.Hawk's job situation is going better than mine. She had no pay cut or furlough this year. A promotion she was angling for a year ago didn't materialize, but she may have another chance this coming year. At least her executives support the idea that she's on a growth path.
Family
I was about to write, "At least in 2020 nobody in our family died," but that's not true. One of Hawk's aunts died in January. She had been ill with inoperable cancer and was age 97, so her passing wasn't a surprise. Other than that, nobody has died. In fact, some people are doing better than before. Hawk's dad, who almost died in 2019, has been getting better. My mom finally got effective treatment for illness she's tolerated for at least several months if not over a year already. There is Covid in the family, though nobody's died from that. An elderly aunt of mine got Covid but recovered pretty well. A college-age niece has struggled with Covid for over 4 weeks now but seems to be on the mend, slowly.Money
You would think a story about money in 2020 would be negative. With widespread closures, loss of business, job loss, etc., there has been plenty of bad news on the money front in 2020. But by late in the year things turned positive, at least for investors.The chart above shows the S&P 500 Index, an amalgamation of the stock prices of the 500 largest US companies, from 1 January to 31 December 2020. As you can see in the shape of the curve, there was quite a drop— a market panic— in late March. I remember the broad markets dropping 10% in a single day— at least twice. But after a few weeks of bloodletting the recovery began. By August the index was back to even with where it started the year. By the end of the year, after a few smaller ups and downs, it finished up 16%. (You can see the actual numbers in the small print in the pic. The index began the year at 3234.85 and ended at 3756.07.)
Now, I've written before that The Market Is Not The Economy. Well, the Index is not the Market, either. Because of the way the S&P 500 index is weighted most of the apparent gains it shows are from the 10 or so hugest companies at the top. For those "mega-caps", heavily weighted toward the modern tech sector, 2020 has been a banner year. For the other 99.8% of the market it hasn't been so sweet. But even so, most market sectors are up for the year. My portfolios, which in the depths of March were down over 20% from January, finished the year up about 10%. That, surprisingly and pleasingly, keeps me on track with my long term financial goals.
The Year Ahead
As we close the book on 2020— or slam it shut— it's tempting to think how much better 2021 will be. And probably it will be better. Coronavirus vaccines were developed in record time (not actually surprising in light of the science behind the development but still historically fast) and are now available. As they roll out across 2021 we may not vanquish Coronavirus but should at least beat it down that life can largely resume pre-2020 normality.But there's no guarantee! If there's anything 2020 has taught us it's how thin the ice beneath us is. For example, what if there's a serious stumble with the distribution or efficacy of the vaccines? What if the virus mutates? What if there's another Black Swan crisis entirely unrelated to Coronavirus? At any moment, in any place or fashion, the ice beneath us could crack and plunge us into catastrophe.
Thus I count my good fortune where I can, give thanks for what I have, and stay careful about how precarious the good life is.
