Morgan Stanley's Michael Wilson warned a "growth scare" for markets could be imminent, if that is in the "next several weeks/months." If so, then all the instabilities of a slowing recovery, deteriorating labor market, waning consumer sentiment, and small business massacre will come out of the woodwork and shock investors.
On a micro-level, we want to share with readers a genuinely shocking, and deep economic scarring story developing in San Francisco.
According to CBS San Francisco, citing a new survey via the San Francisco Chamber of Commerce, "more than half of all storefronts in San Francisco are no longer in business due to COVID-19."
"The survey showed only 46 percent of storefront businesses in San Francisco that were open at the beginning of the pandemic are still operating," said Jay Cheng, spokesman of the San Francisco Chamber of Commerce.
Cheng said 1,300 stores have closed in recent months, with about 1,200 still open.
"There's a lot of reasons for that. If you're a fitness studio, you can't open because of the pandemic. If you're a retail space, you could open, but you might have decided that there isn't enough foot traffic or enough customer base to make that worthwhile to reopen. So it's become a very difficult situation," he said.
Cheng said business closures across the metro area have resulted in depressionary unemployment, with claims nearing 200,000, or four times then what was seen after the financial crash in 2008.
"And what's really unique is that during the Great Recession, we knew what we had to do to get people back to work. We had to fix the housing market, and we had to get consumer confidence back up. Get people rehiring. Now, most of these 193,000 unemployment claims are unemployed because of the pandemic, said Cheng. "Until we get the public health crisis under control, we can't get these folks back to work."
Video: More Than Half of San Fran Storefronts Closed Due To Pandemic
When the growth scare strikes, sending markets into a panic, or mainly a blowoff of technology stocks, investors will search for evidence of deep economic scarring that has morphed the economic recovery from a "V-shaped" to one that resembles a "Nike Swoosh." They will stumble upon the depressing situation in San Francisco of a business massacre.