The economy appears poised to benefit from a COVID-19 vaccine

The stock market continues to respond to news that progress is being made on a Covid-19 vaccine.

While there are some who may not be directly invested, there's a strong indication of how that step might affect the economy.


"This will allow people to get out into the world and start working, again," says RIA Advisors economic strategist Lance Roberts.

"Since economic growth comes, first, from production and then consumption, we all have to go to work and produce, before we can consume. That's good news for the economy."

There are already signs that people are ready to move forward. Take a trip on a Houston highway, and you'll notice the volume of traffic continues to build, as people try to get-on with some normalcy.

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But a reliable vaccine may open the floodgates of pent-up demand. Oil prices spiked on the vaccine-headline, suggesting demand could grow if people were more willing and able to go to work or travel.

There are other, potential, benefits as well. Restaurants and bars could open more widely; customers could return to struggling retailers; the travel and entertainment industry could get some life-support; business, which has aggressively contracted to survive, could get a shot in the arm to welcome employees back.

"Businesses are back to the business of doing business," says Roberts, "What a vaccine does is allow them to expand operation, to attract more business, and take advantage of more things."

On the flip side, companies like Zoom and Peloton, which are marketed for the stay-at-home lifestyle, have struggled with the vaccine news and the concern that we may not need them anymore.

Either way, a vaccine is still months away, under the best of circumstances, and it'll take that long for us to discover which of our new habits will stay with us or go away.