Coronavirus Economics

Hopefully you are well aware of Coronavirus akak COVID-19. The pandemic has caused quite a stir in the stock market. That’s because the market understands that the virus is affect supply chains: we make stuff in China, and if the Chinese can’t work, then we won’t get that stuff here. Economics tells us that the market will rationally predict the consequences of the virus.

But sometimes the market is not perfectly rational. One company who saw their stock increase was Zoom Video. With quarantines, more people are expected to use video conference software, so the market is optimistic about Zoom Video. But a smaller technology company is doing really well too: Zoom Technologies. The company is totally unrelated to the video conferencing software, but because the name is the same, people are accidentally investing in it. The share value doubled this last week as people mistakenly invested in Zoom Technologies instead of Zoom Video. The market isn’t always as rational as we would like.

Pixar’s Onward

As you know, I’ve been doing a series on the economics of Pixar. Well, as luck would have it, Pixar let me see Onward a week early! Why would Pixar do that? Economics of course! See the explanation in this week’s video.