COVID-19 and The White Coat Investor – The White Coat Investor – Investing & Personal Finance for Doctors

I received this email yesterday in response to yesterday’s blog post:

Is this a joke? Regularly scheduled programming while every physician is on the front lines of an all out war with COVID19?? My private practice anesthesia group is cancelling all elective cases….Cmon now….Either put it on hold or help

Typically 1% or less of people bother sharing the way they feel with me about a given post. So if I get one email, I assume there are 100 or more who feel that way. So I thought we would interrupt our “regularly scheduled programming” today to share a few quick thoughts and explain our plans for the next couple of months.

# 1 We Care About Your Safety

Unlike most posts (which are written months in advance) this post is being written the day before publication from an emergency department where I am working my first shift since things got serious in my city. Two emergency physicians in this country are currently critically ill with COVID-19, one in Seattle (younger and stable) and one in New Jersey (older and not so stable.) I cannot ever remember feeling so anxious to go to work as I did before this shift, and that includes my first shift as an attending. Please do all you can to keep yourself, your family, and your patients well. Know that we are thinking of you, praying for you, and perhaps most importantly, right here alongside you fighting against the pandemic. Thank you for what you do. The work you do matters. You have always known this, but events like this will remind the rest of the world. People in China are applauding the health care workers as they walk past their apartments to the hospitals each day to do battle. As we so often say to our warriors–

# 2 We Can Only Read So Much About Coronavirus

I think I spent 6-12 of the last 24 hours reading about and thinking about coronavirus. There is nothing else in my email box, my social media feeds, or on the news. At a certain point, reading more is not helping, it just makes me more anxious. The Happy Philosopher explains it well:

…[Dr. Weil] had some interesting ideas, a few that sounded crazy, but perhaps the most fascinating to me was the concept of the ‘news fast’. Basically he advocated taking intermittent breaks or fasts from news with the idea that constant exposure to news creates stress, therefore lowering the effectiveness of our immune system and leading to a greater propensity for disease.

I kind of blew it off along with most of the other things in the book until years later, when a cascade of events rekindled the idea. Enter the economic crisis of 2009. I was entering a period of maximum work related stress and burn-out just about the time I was simultaneously watching 30% of my wealth evaporate. I was seeing a slow down or actual reversal of my work volume which I figured would probably translate to a lower income. I was consuming countless news stories about the end of financial systems as we know it. Peak oil was threatening to end civilization, politicians were never more partisan*, danger was everywhere. I consumed this negative news with the zeal of a heroin addict looking for his next fix. I was checking the stock market and spot gold prices daily. I ordered a three month supply of Dungeons & Dragons style iron rations which would feed my family through the inevitable disruption of social order.

I felt terrible all the time. I was worried and anxious; the stress felt like a thick fog everywhere I went. Maybe I really was safer, but it sure didn’t feel that way. Then I just stopped and paused. Some part of me dug way back to the idea of Dr. Weil’s news fast and I asked myself two important questions. Was my consumption of news helping or hurting me? Was any of it actionable?

Answer: It was absolutely hurting me. Little, if any of it was actionable. In fact, looking back in the rear view mirror, consumption of news has hurt me in the aggregate. It has led to poor decision making. Overall it has been destructive to my emotional health and taken time from more productive activities…and it is doing the same to you.

I don’t think you should ignore the news completely, but I agree that limiting your consumption is likely good for your mental health. In the coming weeks as we go from work to home (with cooped up kids) and back to work, my readership is not going to suffer from lack of information about coronavirus, but we are likely to seriously benefit from a little bit of distraction every now and then to get our minds off of the serious health, personal, and economic consequences that are occurring and are likely to worsen before they get better.

There is no doubt that personal finance and investing are not the most important subjects in the world, but that isn’t new–it has always been like that. The material on this blog and podcast will not be coronavirus-focused over the next few months. That is on purpose. It isn’t that I am not thinking about it. It isn’t that I lack the ability to come up with a coronavirus angle on everything I write. It is a deliberate decision to offer you a break from what you are doing the other 23 hours and 50 minutes of your day. Take what you find useful and leave the rest.

# 3 Many of My Readers Are Less Busy Than Usual

As I mentioned, I am sitting in an emergency department right now. There are no patients here. My partner saw no patients overnight. Our volumes are down dramatically. We are not alone. Even in Seattle, emergency department volumes are down 25%. I guess it turns out that all those patients weren’t so emergent after all. Many clinics are closed. Elective surgeries are canceled. The fact remains that many, perhaps even the majority, of my readers are less busy than they were two weeks ago. You’re not all infectious disease specialists and intensivists. Some of you are dermatologists and attorneys and small business owners. All of your non-work activities have been canceled, and many of you are out of work. No kids’ sports. No bar crawls. No March Madness. Can’t go to the gym. Movie theater is closed. Your vacation is canceled etc. You have time to learn some new skills and gain some new information. For many of you, the next few weeks will provide you an opportunity to become financially literate and put a financial plan in place for the first time in your lives. I don’t want you to miss that opportunity.

# 4 The White Coat Investor Feeds a Lot of Families

There are five families who depend on The White Coat Investor, LLC for a large chunk (the majority for most) of their household income. WCI is also a major referral source to dozens of other businesses who in turn have families who rely on them for their income. As other business owners know, that responsibility is not one that we take lightly. If we are able to work safely, we will continue to do so.

Luckily, all members of The White Coat Investor staff have a home office. This entire business has always been run from home. Our biggest challenge in the coming weeks will be getting our work done while keeping the kids from killing each other. Certainly, that will affect our productivity, but we certainly won’t be “putting it on hold”. Even with all of us continuing to work just as much as usual, we still expect a drop in business revenue of 75%+ over the next 3 months for various reasons. Luckily the business has no debt and even some cash reserves that should be able to tide us over and allow us to make payroll during these trying times. I fear that many businesses in the world are not in the same position.

# 5 The Need is Great

As I write this, the stock market is down over 9% today and down 28% from its recent peak. This is the bear market I have been warning my readers about for years. For many of you, this is the first time you have suffered through the loss of real money that you invested for your future instead of spending on a new car, a kitchen renovation, or a Paris vacation. We will be here to reassure you that while every bear market is different and our crystal ball is just as cloudy as yours, we’ve seen this movie before and we know how it ends.

This is the time to stay the course and follow your reasonable, written financial plan. No, you should not take your emergency fund and invest it in stocks to take advantage of a “bargain.” But neither should you be afraid to rebalance and continue to invest for your future as per your routine. The money you invest in the coming weeks will have the best long-term return of any money you invested for the 5 years before and after this event. As Shelby Cullom Davis said, “You make most of your money in a bear market, you just don’t realize it at the time.”

Readers will need reassurance not to sell low (like three of my partners who did so near the market bottom in 2008 only to need to work a decade longer to recover from that mistake). Those readers who have not gotten around to putting a written financial plan in place will now feel more impetus to do so. Some will need to learn how to tax loss harvest. Others will be more convinced of their mortality and more willing to buy that insurance and do that estate planning they have put off. Let us know what financial subjects you would like to see on the blog and podcast in the coming weeks and we’ll interrupt the previously written and scheduled content to meet you where you’re at.

So my dear reader, in this trying time know that we are here thinking about you, praying for your safety, and working hard to serve you just as we always have. Do not assume that just because we are talking about silly stuff like the stock market or budgets that we do not know there are more important things in life. Hopefully, you will find the information we provide in coming weeks to be useful in your life (or at least a healthy distraction.)

What do you think? Is it appropriate for bloggers and podcasters to talk about anything but the pandemic right now? Should they quit publishing at all? What would you like to see/hear on the blog/podcast in the coming weeks? Comment below!