Sweden seems to have bucked the trend, having resisted a lockdown since the beginning of the pandemic. The government hasn’t closed down schools or restaurants and people are free to move around as they please. Yet despite all this, Sweden has had fewer deaths per capita than Belgium, Spain, Italy, France and the U.K. – albeit at a much higher rate than its neighbors, Norway, Denmark and Finland. While it hasn’t issued stay-at-home orders and other lockdown measures, it has, however, experienced an economic downturn nearly the same as those that did introduce the measures. In other words, the global impact of the coronavirus and the psychological effect on Swedish consumer behavior is nearly the same as it is in countries that have introduced a lockdown. Will this be a harbinger of what’s to come in the post-pandemic world? Yes and no.

In Belgium, 790 people died from the coronavirus per million. That number is twice as high as Sweden’s. In neighboring Norway, however, that number is closer to 40 deaths per million citizens. Sweden, by contrast, has had 380 deaths per million – 850% more deaths than Norway. While a major difference, many argue that ultimately everyone will be infected and those that are more susceptible to die from it just did so at a quicker pace in Sweden. It has merely accelerated the inevitable. While this may ultimately be proven to be true, the "herd immunity" that Sweden sought is still far off. Preliminary reports indicate that less than 5% of the population has contracted the virus, a far slower pace for building up immunity.

The real takeaway from the "Sweden experiment" for investors, however, isn’t one of deaths and health but rather dollars and cents. Despite not "closing," Sweden has seen a 30% drop in retail spending, with specific sectors declining even more. Demand destruction it appears is as prevalent in Sweden as it is around the world, albeit at a more measured pace.

This past week, Sweden has seen a rapid increase in deaths per capita, becoming the deadliest country in Europe, according to an Oxford study. If the Swedes continue to be vigilant and remain "open" throughout the pandemic, they may weather the storm and emerge first globally. If they don’t and opt to change course, theirs may be a similar experience with those that "locked down" much earlier. But this much is clear: demand destruction is real whether countries close down or not.

Some of this demand destruction is related to a global slowdown, while some of it is merely psychological. But the bottom lines of Swedish companies are hurting just as much as their neighbors. It appears that consumer demand will take many more months, if not years, to reemerge – even if countries reopen in the coming weeks.