COVID will not dramatically change consumer behavior, but people may save more: Housel

"I don’t think if we have to fast forward 2-3 years – I cross my fingers and say – we are all vaccinated by that period of time, it is no sure thing but let us use that as a baseline assumption, I don’t think there is going to be a dramatic change in consumer behaviour.

People are still going to get on the airplanes, they are still going to go to bars, they are still going to pack in the night clubs, in restaurants - that I don’t think will change. For two reasons – one is that if you think about the 1918 flu pandemic and if you go back to the period after 1918 pandemic, early 1920s, I haven’t been able to find any evidence that people were scared to go to restaurants, scared to go to bars. 1920s was the era of the jazz bars where people were packing tightly into these night clubs, that was just a couple of years after 1918 flu pandemic, it was called as roaring 20s.

After September 11 in the US, right after 9/11, a lot of people said Americans are not going to fly again, they will be too scared to get on airplanes and not going to travel, they are not going to go on vacation and that was true for about six months, people were cautious, worried but people got back on airplanes.

So I don’t believe that just because of what we have gone through this year, the consumers are going to drastically change their behaviour.

What I do think will change though is that those consumers will probably have a higher propensity to save money because they witnessed first-hand, they saw how devastating it can be to be caught off-guard if 40 million people in the US lose their jobs in one month and people don’t have an adequate amount of savings, particularly small business owners. People in the US will have a higher degree of wanting a social safety net."