It's a word you've probably heard a million times before. It's certainly been in your inbox a lot. And, most likely, you've said "new normal" yourself more than once.
Sure, it's a catchy and memorable word. Moreover, the past year has been extraordinary, full of turmoil and sacrifice, and many forced into isolation. In such an experience, the word touches on a sense of dislocation that everyone can relate to. But what does the new normal really mean?
"We discuss the new normal with an almost religious fervor." Amy Webb, founder and CEO of the management consulting firm Future Today Institute, says, "I've been curious for a while: what exactly is driving our search for answers to the new normal? I don't think the answer is that people want to know what the future looks like so they can plan for it. Instead, I think the reason we are desperate to understand the new normal is actually that we all want the future to stop changing so much."
After the turmoil of the past year, the psychological desire to slow down change and hope for a more normal future is a perfectly understandable reaction. The biggest variable, of course, is the New Coronavirus, which has infected about 100 million people worldwide and killed more than 2.1 million. The New Coronavirus epidemic has taken a huge toll on the economy, but it has also accelerated the development of new technologies that have changed the way we work and live, bringing variables that make it difficult to predict where it will go in the long run.
As much as we may want to hit the "pause" button, that is not an option in reality. Now more than ever, it is urgent to understand what happens next and where business, the economy and the common fight against the new pneumonia will go from here. The key may be to figure out that after 12 months of turmoil, some things will now be "new" forever and some things will remain "normal," and the hard part will be recognizing which is which and finding the right response.
Just look, for example, at the election of President Joe Biden. He's been a centrist all his life, a traditional politician with a self-awareness that might as well have had the word "normal" printed on his mask. But the fact that the Democrats will have a slim lead in both houses of Congress for at least the next two years is certainly "new": a power shift that will affect Wall Street, global trade and U.S.-China relations. And this result comes in the wake of one of the most contentious elections of our time - a desperate attempt by the outgoing president to reverse his absolute defeat by spreading misinformation, no doubt adding to our anxiety about the "new" moment.
For Ian Bremer's clients, the Washington reboot is absolutely top of mind. He is the founder and president of the Eurasia Group, a political risk consulting firm, and each of his clients wants to know, "What's different about Biden? How much control does he have? Is the U.S. really facing more serious structural risks than we thought?"
Wall Street seemed to believe that under Biden's leadership, life would return to "normalcy" to the maximum extent possible. From election day to Biden's inauguration on Jan. 20, the S&P 500 rose 14.3 percent. All told, Biden's boost to the stock market was more than twice as strong as Trump's four years ago, when the S&P 500 rose 6.2 percent over the same period. For now, it seems the market is unfazed by onerous new regulatory requirements or tax hikes. At the same time, it seems that the major banks are competing to release the most optimistic GDP forecast: JP Morgan Chase (JPMorgan Chase) forecast that the U.S. economy will grow by 5.8% in 2021. Morgan Stanley (Morgan Stanley) forecast is 6.4%. Goldman Sachs is 6.6 percent. People believe that there is a lot of suppressed demand, consumer behavior will be "retaliatory" back to "normal".
Of course, much of the confidence comes from the rapid launch of the New Crown pneumonia vaccine, which has shown promising results and has been developed in a "new" way and at an unprecedented pace. (To read the story of Pfizer's successful collaboration with BioNTech on the vaccine, see the "Conversation" section in this issue.) Despite a lackluster start, vaccination efforts are now accelerating in the United States, even as the virus has mutated and become more contagious. Initially President Biden announced his intention to administer 100 million doses of vaccine within 100 days of taking office, and by the end of January he promised that by the end of summer the United States would have enough vaccine for 300 million people.
In international relations, the new normal may resemble the old one. The Biden administration will move quickly to ease tensions with key allies. In trade negotiations, the White House will also return to a less destructive style of diplomacy and a renewed globalist mindset, which means predictability that businesses relish.
But the challenges remain daunting: The exacerbation of the epidemic has highlighted income inequality in the United States. The epidemic has also further disrupted the business ecosystem, with thousands of small businesses closing down and some big ones soaring as our reliance on tech giants deepens.
Tech companies were our saviors as we lumbered through the epidemic. During the lockdown, thanks to tech companies, we were able to use Zoom for video work sessions, brush up on our TV shows, buy clothes online, and stay socially engaged in quarantine. But for many people, this "new" situation is not the "norm. Regulators, elected officials from both parties, and consumers are all feeling a little uneasy about the influence of large technology companies. In January, a poll conducted jointly by Fortune magazine and SurveyMonkey found that 64 percent of U.S. adults want the federal government to conduct an antitrust investigation of at least one major tech company. (Google and Facebook are already under scrutiny.)
Bremer said the gagging measures taken by social media companies against Trump in the final, dark hours of his presidency added an unexpected twist to the debate. In the eyes of Republicans, he said, technology regulation now belongs in a partisan battle. "Whether they like it or not, tech companies are suddenly all on the same side as the Democrats." Bremer said, "I can't remember a time when the most important companies in the U.S. economy have been in such a bitter partisan battle with a political party." This may not be the "norm," but it is definitely a "new" situation.