In the ‘post-Covid’ world, irresistible and partly unpredictable forces are at work: it is the ‘next normal‘. Everything is changing with accelerated speed in a framework in which, at least on a business level, the winners take everything, even more than before, and the losers either disappear, or survive on the margins, subsidised by the state. After the wage, comes the citizenship bonus.

There is a part of us that runs faster and faster to survive or prosper. For the rest of us, we are left with rents for the smartest, public handouts or expulsion from the market. How long can this last?

The behaviour patterns of companies, the state and households are being transformed. Consumer demand and the supply model of more flexible companies is undergoing a metamorphosis. Underlying it all is the acceleration towards digital adoption, both in the BTC and BTB worlds.

According to McKinsey[1], the factors shaping the future are the evolution of spending behaviour,   the state, which is increasingly ‘sovereign’.

Let us not be influenced only by the macro data certifying the collapse of consumer and investment spending and the surge in the household savings rate. Several sectors are booming.

Investment in technology is galloping, as is demand for furniture and home devices. Businesses are spending, anticipating the perhaps permanent effects of the pandemic: cloud computing, cybersecurity, machine learning and data mining remain the focus. Households are spending (see graph, Source: McKinsey) on new connections, broadband, innovative devices, online services and products, gaming, but also tables, chairs and sofas. Above all, governments spend money that they “create” with debts that may never be repaid. But this is how it is today.

Work organisation and company logistics are changing. The resilience of business processes is increased, with a more considered assessment of the underlying risks: supply chains are secured, onshoring is back in fashion, financially weaker business partners are protected, cash levels are increased through new long-term debt and divestment of non-essential assets.

In the meantime, there is an accelerated transition to remote working[2] (see graph, source: McKinsey), which implies the adoption of new organisational structures focused on effectiveness and speed in decision-making.

The emphasis is on cutting hierarchical levels and “flat” organisational structure, taking responsibility and empowering talent to focus on priorities. Radical flexibility is needed to accelerate ‘time to market‘.

The raw material of the companies of the future, the ‘human resources’, the Marxian ‘workforce’ of post-modernity, is participating despite itself in the never-ending challenge based on the search for talent, with ever lower geographical barriers: it will always be possible to find someone ‘smarter‘ than you behind a home workstation wherever they are, from Alaska to Vietnam.

While populist politics rants about the banality of ‘one is worth one’, the world of work, at least at the level of global corporations, seems to be going in a completely different direction. On the other hand, in Italy, for decades a ‘corporation free‘ country, who cares?

The next normal‘ is Wal Mart, which is joining Microsoft in bidding for Tik Tok‘s US business. The giant of traditional commerce is looking for space online, imagining the video platform for teenagers as a means of previewing the evolving tastes of consumers of the future, developing advertising and online sales, possibly creating its own alternative ecosystem to Amazon and E-Bay, a digital marketplace in which to bring together the products of its suppliers. And the deal is on the table at the behest of Trump, the standard-bearer of national interest, border closure and economic protectionism.

After the “L”, the “V”, the “U” and the “W”, some storyteller has invented the “K” shaped recovery: some go up, some come down. The pandemic, like and better than leverage, amplifies the competitive advantages of the oligopolistic masters of the digital economy and related sectors. The 2020 meteorite drastically separates losers and winners with activities in even contiguous sectors in a seemingly arbitrary manner. Many had bet on commercial real estate: the winners were those who bet on the warehouses of goods that feed the online distribution network; the losers were those who invested in infrastructures supporting tourist or corporate mobility.

The consequences are also radical for deciphering financial market trends. Macro analyses, if they were ever of any use at all, lose their value. This is all the more so given the turnaround of central banks (financial repression ancillary to deficit financing) and public policies, with the state once again assuming, after at least four decades, a key role, now undisputed, of support, direction, investment and redistribution (see chart opposite). In short, a remake of the old ‘tax & spend’ of the[3] 1970s, which some claim to repaint as an ‘innovative’ state. We shall see if it is capable of producing ‘good’ debt [4]or, as has always been the case in our latitudes, ‘bad’ debt.

In the stock market, the microeconomic narrative wins, the separation between the ecosystem of digital giants and (almost) everything else. It is the ‘inconceivable’ world of the continuous growth of ‘network’ and stock market returns; the oxymoron of ‘parallel divergences’ comes to mind: in the long run, (almost) all stock prices rise, but some always rise more than others, regardless of GDP, rates, exchange rates, governments and so on. On the other hand, over the last thirty months, while sales and profits of the FANG+ index have grown by 80 and 140% respectively, those of the MSCI ACWI global index have remained flat and fallen by 20%.

It is hard for the elderly not to look back at historical events. The climate is very reminiscent of the “TMT” bubble of 2000 (see graphs): at that time, too, the clamorous divergence between the valuations of stocks linked to the Internet, broadband expansion and the convergence of media and telecommunications and those of the so-called “old economy” was macroscopic, but justified by many. It must be said that the situations are only apparently comparable. Back then we were faced with thousands of start-ups, very few of which survived (including Amazon and Google); today we are faced with the global domination of apparently unassailable giants. We shall see if the ending is different.  

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[1] McKinsey & Company, Covid-19, Briefing Materials updated 6th July 2020.

[2] A recent market survey carried out by the British company CCS confirmed that more than 34% of respondents (730 top managers) expect more than 50% of the workforce to be able to work in smart working in the future.

[3] “Tax and spend is the new economic orthodoxy”, Financial Times,

[4] Indirect reference to Mario Draghi’s much-quoted recent speech at the 2020 Communion and Liberation meeting.