In the spring of 2010 the Middle East reached a tipping point. It was called the Arab spring. A decade later, we are in the midst of the American Spring. We are the country whose fuse is lit and ready to explode. With the stock market making COVID-era highs, the disconnect between reality on the street and the illusion created by printing money, lending at 0% interest rates and outright lies by the federal government, has now seeped into the psyche of the American people. The illusion that 40 million unemployed can be fooled by a check in the mail and bringing back sports is finally being shattered and the glass will cut deep across the political divide.
We have completed the timely filing of our first quarter 2020 financial results. This marks our 10th 10-Q filing as a public company, along with having filed our 5th 10-K in March. Quarterly revenues were approximately $293,000, at the lower end of the range I had expected. Nevertheless, I am delighted, given the headwinds we withstood and the visibility we now have. With some clients asking for discounts and deferred payments and employees making it through a three week period of limbo in March that reshaped our company’s routine and monopolized our time, revenues quarter over quarter were essentially flat. They were, though, over 8 times higher than Q1 revenues in 2019. All things considered, this was a quarter I will never forget, both for its intensity and lessons learned.
I was listening to an interview of Real Vision CEO Raoul Pal, in which he was asked for some macro perspective on the world economic scene. While he was far from confident that fiscal and monetary policy can “paper over the cracks” in our economic foundation, Mr. Pal was emphatic that, for all the focus on lifting restrictions and bouncing back to business as usual, “reopening is a mirage.” Sure, he says, consumption will return to some degree, but not at all to the degree that people and markets seem to be expecting. The continuous media driven cycles by political parties and scores of other special interest groups have constructed this so-called mirage of “reopening,” in a desert where our nation’s leaders are wandering aimlessly. Prepare not for a reopening of the American culture, but rather a reimagining of the American society and, by extension, the American dream. The new American Dream will be found online in democratized digital environments from platforms like Vimeo, Spotify, and Vocal.
The very nature of the global economic structures we have taken for granted over the last decade are in jeopardy, from the integrity of the European Union to the future of supply lines from China, a country that stands accused of lying to the world about the extent of the virus. Coronavirus has obliterated over 22 million jobs, which amounts to nearly all the jobs that were created since the end of the financial crisis 10 years ago. This economic crisis will have a domino effect and continue to impact one facet of society after another. Ultimately it will create a wall of worry for financial markets to climb. As time passes and we begin to understand the scope of this crisis, facts will eventually force action. There are plenty of opinions about the whos, whys, whens, and hows, but we all know one thing for certain: it will take a long time for the effects of a global economic shutdown to settle enough to create some semblance of a "new normal."