As COVID coming to the U.S., the economy was also impacted it. On March 9th, there were three stock halts in one day. This is known as a historical plunge. In ten days, there was the fourth stock halt that again impacted the trading in the market.
How it all started?
China was impacted by the pandemic first. Chinese economy was also negatively impacted by it. When the virus spread to America, the U.S. economy faced unprecedented downturn. With globalization, many companies overseas are connected and working together. When one country’s economy is going down, other countries will be affected by it as well. American stocks were impacted by the pandemic in China following by the domestic pandemic and in Korea, Italy, and other countries. The stock was strongly impacted by the spread of the virus and its strong impact on all these countries.
Moreover, the oil and gold prices were also dropped because of the crises. All of these factors are interconnected and causing the four stock halts to happen. Therefore, the global health of people is impacting economic health. When more people are getting sick or passed away, there will be fewer people working or buying. The GDP will drop with fewer productions made for sale and fewer consumers to spend in the market.
Why it matters?
For individuals, these stock halts are impacting their trading. If you are in the market, most of the money you invested in it was gone because of it. Even if you are not in the stock market, you are still impacted by it since the economy worsened already. It is possible that the financial crisis will follow. In other words, your wages might be cut or even you will get laid off.
For America, as a country, governments need to find ways to promote spending again to prevent economic depression from happening. If there is a financial crisis, it will take a long time and many actions by the governments to help the economy to recover.