Mental health is one of the most important aspects of our well-being, especially in the aftermath of the Covid-19 pandemic. But how can we cope with the challenges and changes that the pandemic has brought to our lives, work, and society?
In his book The Phoenix Economy, Felix Salmon offers a tour-de-force analysis of the profound and transformative years of the early 2020s, both for individuals and for the global economy. He reveals the surprising benefits and opportunities that the pandemic has created, and how we can leverage them to improve our mental health and happiness.
If you want to learn how to thrive in the new not normal, and how to make the most of the phoenix economy, you need to read this book. In this article, I will give you a comprehensive summary and review of the book, and show you how it can help you achieve your personal and professional goals. Read on to find out more!
Nonfiction, Economics, Business, Finance, Sociology, Psychology, Self-Help, History, Journalism, Futurism
The Phoenix Economy is divided into three parts, each exploring a different aspect of our lives that has been transformed by the pandemic: Time and Space, Mind and Body, and Business and Pleasure.
In the first part, Salmon examines how the pandemic has changed our perception and use of time and space. He argues that the pandemic has accelerated the trends of remote work, digital nomadism, and urban exodus, and that these changes have both positive and negative implications for our productivity, creativity, and social connections. He also discusses how the pandemic has disrupted the traditional cycles of work and leisure, and how we can find a new balance between them.
In the second part, Salmon explores how the pandemic has affected our mental and physical health. He shows how the pandemic has exposed the flaws and inequalities of our health care systems, and how we can improve them with innovation and collaboration.
He also analyzes how the pandemic has influenced our behavior, emotions, and values, and how we can cope with the stress, anxiety, and uncertainty that it has caused. He suggests that the pandemic has given us an opportunity to rethink our priorities, and to focus on what truly matters for our happiness and well-being.
In the third part, Salmon investigates how the pandemic has reshaped the global economy and the world of business. He explains how the pandemic has triggered a wave of creative destruction, and how new industries, markets, and business models have emerged from the ashes of the old ones.
He also examines how the pandemic has altered the dynamics of power, wealth, and inequality, and how we can address the challenges and risks that they pose. He argues that the pandemic has created a new paradigm for economic growth, and that we need to embrace it with optimism and adaptability.
The Phoenix Economy is a brilliant and insightful book that offers a comprehensive and compelling analysis of the social and economic ramifications of the Covid-19 pandemic. Salmon is a renowned journalist and commentator who has a deep understanding of financial markets and the quirks of human behavior.
He writes with clarity, humor, and flair, and he supports his arguments with evidence, anecdotes, and examples. He covers a wide range of topics, from meme stocks to lobster rolls, and he provides a balanced and nuanced perspective on the complex and contradictory effects of the pandemic.
He does not shy away from the challenges and uncertainties that the pandemic has created, but he also highlights the benefits and opportunities that it has opened up. He challenges us to think critically and creatively about the future, and to embrace the changes that the pandemic has brought to our lives, work, and society.
The Phoenix Economy is a must-read for anyone who wants to understand the impact and implications of the Covid-19 pandemic, and who wants to learn how to thrive in the new not normal. It is a book that will inspire you, inform you, and empower you to make the most of the phoenix economy. It is a book that will boost your mental health and happiness.
In this perceptive look at the COVID-19 pandemic and its aftermath, financial journalist Felix Salmon takes stock of a legacy of lockdowns and social distancing. He details the pandemic’s market effects and inflation, but he also delves into the societal costs of the virus.
In just one of many insightful bits of analysis, Salmon frames the bubble in meme stocks, cryptocurrencies and NFTs through a generational lens: Millennials took a chance at getting rich while spurning their elders’ traditional views. Along with its deep dives into the mental health crisis and the upset in American workplaces, Salmon’s text offers a comprehensive view of COVID-19’s lasting impacts.
- The COVID-19 recession was part of a “great acceleration” of economic timetables.
- The pandemic reshaped how Americans invest.
- COVID-19 changed the world of work, for better and for worse.
- The pandemic resulted in prosperity being more evenly distributed across the United States.
- COVID-19 shoved many nations into collective cocoons.
- The pandemic exacted a major toll on mental health.
- A new era of inflation arose on the heels of the COVID-19 pandemic.
The COVID-19 recession was part of a “great acceleration” of economic timetables.
The economic downturn that hit the US economy in mid-March of 2020 was so dramatic that it clearly qualified as a recession. But economists traditionally define a recession as back-to-back quarters of declining economic output; the COVID-19 recession lasted just two months.
The speed of the downturn and recovery shortened timelines of all sorts. For instance, the US Bureau of Labor Statistics’ jobs numbers for March 2020 could scarcely hope to capture the reality that the labor market was strong for the first half of the month but then fell off a cliff in the second half.
“Entire business cycles got compressed into a period of months; industries could rise and fall before the pandemic was even over.”
Zoom and Slack, two technology companies that went public in 2019, became household words almost as soon as the pandemic started. But just as quickly as Zoom shares benefited from the COVID-19 boom, they fell back down to Earth. While Zoom was hot for a few months, it didn’t take long for Microsoft to respond. Perhaps if Zoom had grown more gradually and quietly, Microsoft wouldn’t have noticed the upstart. But Microsoft promptly responded by upgrading Teams.
From there, it didn’t take long for corporate managers to realize that Microsoft Teams had a high-end videoconferencing option, and that companies already paying for Teams didn’t also need a subscription to Zoom. Before long, Zoom’s valuation retreated to pre-pandemic levels. This sort of rapid adaptation is a hallmark of “the Phoenix Economy.”
The pandemic reshaped how Americans invest.
Baby boomers were reared on the ethos of stock-picking and market-timing, not to mention high interest rates. In 1989, one-year Treasury bills yielded 9.6% – meaning a nest egg of just $622,000 yielded a low-risk, comfortable annual income of $60,000. Generation X grew up in an era defined by index funds and generalized pessimism about the economy and markets.
But millennials came of age during the pandemic, and they embraced the notion of get-rich-quick. What’s more, interest rates had been effectively at zero for millennials’ adult lives, meaning the notions of investing for the long run and getting rich slowly became obsolete.
“A major component of the rocket fuel propelling the phoenix out of the ashes for years to come is going to be just the newly acquired knowledge of what is possible.”
Millennials also found themselves in a financial situation that encouraged both hopelessness and risk taking. Those who had earned college degrees were drowning in student debt. And those who hadn’t earned college degrees had no real hope of earning enough money to become long-term investors.
For both groups, achieving homeownership seemed out of reach. So millennials embraced the investing equivalent of lottery tickets: They flocked to meme stocks, NFTs and cryptocurrencies. Maybe they’d get lucky and strike it rich, their thinking went.
The pandemic played perfectly into this new mind-set. Robinhood allowed small-stakes investors to trade on their smartphones. During the early months of lockdown, millennials had nothing to do but speculate – and they were rewarded by a boom in asset prices.
Shares of GameStop and AMC soared, as did the value of the cryptocurrency Shiba Inu. Some of the returns were truly dizzying: When Shiba Inu debuted in 2020, the blockchain showed that someone had invested $8,000 in the coin. A year later, that stake was worth $5.6 billion.
In the past, speculative bubbles would end badly for investors, such as the dot-com crash of 2000 that cratered portfolios across the board. But the meme stock and crypto boom of 2020 and 2021 simply ended with little real damage. It turned out that most people buying these speculative assets bet only as much as they could afford to lose. And those who did lose big just went on with their lives, though Robinhood and Coinbase took hits from a decline in trading volumes.
“A new investing paradigm had emerged, one based not on economic fundamentals but rather on social ones.”
During the pandemic bubble, commentators on CNBC derided the speculators as irresponsible.But what baby boomers didn’t grasp was that millennials liked the disapproval. On Reddit’s r/wallstreetbets channel, speculators proudly boasted of their massive losses on meme coins. In this brand of “ironic nihilism,” the protagonists knew they were making ridiculous bets.
That’s why they were so gleeful when their ludicrous trades paid off. In a zero-interest-rate world, traditional assets offered a pitiful return, so why would anyone bother? All the momentum shifted to sneakers or baseball cards or cryptocurrency or NFTs – these assets boasted the scarcity that caused their values to shoot to the moon.
“Collecting NFTs made investing more fun than it had ever been before.”
The meme-stock generation turned the whole idea of investing on its head. These investors didn’t care about long-term returns; NFTs and crypto were driven entirely by a frenzied pursuit of short-term gains. The new breed of speculators didn’t want to fixate on fundamentals and metrics – that was boring.It was much more entertaining to trade digital images of Bored Apes or CryptoKitties.
COVID-19 changed the world of work, for better and for worse.
Before 2020, work was mostly in person and face to face. This traditional type of arrangement relied on proximity – young workers learned by observing others and by being corrected when it became clear they didn’t know what they were doing or how they were expected to do it. The pandemic dramatically remade old notions of workplace propriety.
In 2021, AMC CEO Adam Aron was doing a live video shoot on YouTube when he fumbled his camera and revealed he was wearing no pants. No one particularly cared – casual dress from the waist down had become the norm. TikTok users even started a trend of stripping down while a domestic partner was on a work Zoom call and then recording the partner’s reaction.
“In an office setting, it’s much easier to notice when a colleague needs help, and to act on that.”
The new work arrangements made employees feel less loyal. The Securities and Exchange Commission experienced a 30% increase in whistleblower complaints during the pandemic. Before the pandemic, working remotely was a firing offense.
Hedge fund manager Marc Helie lost his job for the sin of working from his Hamptons beach house on Fridays during the summer. Billionaire Eddie Lampert was pilloried for running Sears from his Miami mansion and venturing into the Illinois headquarters only on rare occasions.But during the pandemic, the idea of people working together faded.
So did the requirement that companies with office space in Manhattan and San Francisco pay rents north of $100 per square foot. Real estate developers quickly adapted to the work-from-home reality. New apartments constructed after 2020 were nearly 10% larger than rental units built in the previous decade, and newly built houses were reconfigured to include offices, sometimes with separate entrances.
The pandemic resulted in prosperity being more evenly distributed across the United States.
Before COVID-19, America’s biggest businesses and wealthiest people were concentrated in a few areas, including New York City and Northern California. In that way, the geography of prosperity was “spiky.” Then came work from home, and Americans could leave Manhattan and San Francisco for Austin or Boulder or Boise.
The upside was that ambitious workers no longer were funneled into the least affordable housing markets. The downside was that employees no longer built in-person relationships with their coworkers – and the United States became an even more sprawling place, with a bigger carbon footprint.
“There will definitely be an adjustment period as American capitalism recalibrates itself for the new spatial realities.”
The pandemic also reversed decades of globalization. Before 2020, China and Russia had integrated themselves deeply into the world economy. Then came Beijing’s zero-COVID policy, which prevented anyone from entering or leaving the country. Moscow removed itself from the global economy when it invaded Ukraine in 2022.
Even Western allies turned away from one another. The United States kept its borders closed to European travelers well after coronavirus vaccines were widely available. Meanwhile, the pandemic disrupted global supply chains in unexpected ways.As the pandemic wound down, the world economy retreated from globalization and moved toward protectionism and reshoring.
COVID-19 shoved many nations into collective cocoons.
China is a prime example: The pandemic served as an excuse for President Xi Jinping to aggressively pull back from Western-style free market capitalism. Xi’s predecessors had embraced a shift toward individualism; Xi unwound those reforms and moved back to collectivism. But China wasn’t the only place to embrace social protectionism.
New Zealand also enacted draconian travel policies. That country’s citizens weren’t allowed to leave the country for more than two years. Intriguingly, the nations that imposed the harshest measures also had low rates of COVID-19 deaths, raising questions about whether severe measures kept people safe or were an overreaction to a calamity that never came.
“Even during the pandemic, it was rare to see COVID-controlling policies being driven by popular pressure, rather than from top-down scientific advice.”
Collectivist urges have been around for centuries. During another public health crisis – the medieval Black Death – Venice imposed a zero-plague policy that involved requiring ships to anchor outside port for 40 days. The Italian word for 40 is quaranta – and the origin of the word “quarantine.” The city of Milan contained the plague in a seemingly cruel way: If one person came down with the disease, the entire family was walled up in its home and not allowed to leave. It was collectivism at its most fundamental. Innocent people were punished with death, but the policy ultimately saved lives.
The pandemic exacted a major toll on mental health.
The global economy quickly rose from the ashes of the pandemic. But the world is still sorting out the cost to human mental health. The Lancet reported a 28% jump in depression and a 26% increase in anxiety disorders in just the first year of the pandemic. That qualifies as a crisis – tens of millions of new mental illnesses occurred during the pandemic.
Humans thrive on social contact, and the pandemic prevented interactions. The effects were especially acute for children. Several major medical organizations declared a pandemic-induced national state of emergency in children’s mental health.Young adults also showed signs of a mental health crisis. For the 12-month period ending in April 2021, drug overdose fatalities in the United States topped 100,000, a first. Many of those deaths were of young adults.
“Almost no one on the planet was mentally unscathed by the pandemic – which is also the thing that might just cause a mental-health phoenix to rise.”
The epidemic of mental illness overwhelmed the medical profession. Unable to keep up, America’s psychologists and psychotherapists simply put people on waiting lists or closed their practices to new patients.Busy mental health professionals were forced to make tough choices. Some prioritized clients who were suicidal – but that meant patients in less imminent crisis had to wait for care. If there’s any good news about the mental health crisis, one glimmer is that some people are feeling better as life returns to normal. What’s more, the sudden surge in mental illness helped make such diagnoses more socially acceptable.
A new era of inflation arose on the heels of the COVID-19 pandemic.
In 2022, prices began soaring. A long-forgotten foe, inflation returned for three primary reasons: First, the pandemic disrupted supply chains, leading to shortages. Second, fiscal policy aimed at the short but deep COVID-19 recession increased the supply of money. Third, Russia invaded Ukraine, roiling energy markets and causing fuel prices to spike. Meanwhile, a shortage of workers forced employers to boost wages to attract labor. The Great Resignation was especially acute in the service sector – restaurants had to pay workers more or cut hours, or both.
“When it comes to discretionary purchases, or even people removing themselves from the workforce because they feel like it, price inflation is sometimes just a way of revealing a country’s changed preferences.”
Inflationary forces can be complicated, as illustrated by the Clam Shack in Kennebunkport, Maine. The restaurant raised prices for lobster rolls – but not because lobster prices were rising, and not necessarily due to labor costs. The Clam Shack hires seasonal workers from overseas on J-1 visas, and their wage of $12.75 an hour for regular time and $19.50 for overtime didn’t pressure the Clam Shack’s bottom line.
Rather, it was everything else going on in the world that caused lobster roll prices to soar. The Clam Shack partnered with a fast-growing meal-delivery service that sold high-quality food to people who didn’t want to go to restaurants during the pandemic. What’s more, many restaurants had cut back hours because of a lack of workers. So the Clam Shack was so busy boiling lobsters that it had essentially no choice but to raise prices. Lobster dinners are a discretionary purchase, of course, and the Clam Shack’s price increases reflected the ability of some producers to raise prices without hurting demand.
About the Author
Felix Salmon is chief financial correspondent at Axios and the host of the weekly Slate Money podcast.