It Is Easy to Overreact to the Chinese Coronavirus

Recently, a new coronavirus has been causing many illnesses and deaths. The virus first became active in Wuhan, China, but it has already spread to the rest of China. Scattered cases have been identified around the rest of the world as well.

There are two important questions that are already being encountered:

  • How much of an attempt should be made to limit the spread of the new virus? For example, should businesses close to prevent the spread of the virus?
  • Should this disease be publicized as being far worse than flu viruses that circulate each year and cause many deaths among the elderly and people in poor health? The median age of those dying from the new coronavirus seems to be about 75.

Unfortunately, there aren’t easy answers. We can easily see the likely outcome of under reaction. More people might die of the disease. More people might find themselves out of work for a couple of weeks or more with the illness. We tend to be especially concerned about ourselves and our own relatives.

The thing that is harder to see is that reacting too vigorously can have a hugely detrimental impact on the world economy. The world economy depends on international trade and tourism. China plays a key role in the world economy. Quarantines of whole regions that last for weeks and months can have a very detrimental impact on the wages of people in the area and profits of local companies. Problems with debt can be expected to spike. The greater the reaction to the coronavirus, the more likely the world economy will be pushed toward recession and job loss.

The following are a few of my thoughts regarding possible overreaction:

[1] The Chinese coronavirus seems to be extremely contagious, even before a person who has been exposed shows any symptoms. The only way we can be certain to contain the virus seems to be through quarantines lasting up to 14 days.

China’s National Health Minister, Ma Xiaowei, has provided information that seems quite alarming. With the new virus, a person may become communicable shortly after he/she has been infected, but symptoms may not appear for up to 14 days. This allows the infected person to infect many others without realizing that he/she is a carrier for the disease.

Today, the United States and many other countries screen for the virus by checking passengers arriving on planes from affected areas for fevers. Given the information provided by China’s National Health Minister, this approach seems unlikely to be sufficient to catch all of the people who may eventually come down with the disease. If a country really wants to identify all the potential carriers of the disease, it appears that a 14-day quarantine for all travelers from infected areas may be needed.

Such a quarantine becomes administratively difficult to handle for the huge number of people who are likely to travel from China. Such a quarantine would make it impossible for pilots and other airline workers to make a living, for example. They would be spending too much of their time in quarantine to do the work needed to support themselves and their families.

A related concern is that person-to-person transmission is very easy with the Chinese coronavirus. We don’t know for certain how many people each infected individual infects, but one estimate is that each infected person transmits the disease to an average of 2.5 other people. With this transmission rate, the number of people having the disease can be expected to grow exponentially, perhaps for several months.

Based on these concerns, it seems to me that funds spent on trying to contain the coronavirus are likely to be largely wasted. The new Chinese virus will spread widely, regardless of attempts to contain it. At most, quarantines will slightly slow the transmission of the disease. At the same time, quarantines will be quite disruptive of commerce. They will tend to reduce both total wages and total output of goods and services of the area.

[2] Deaths from pathogens are part of the natural cycle. They help prune back the population of the old and weak.

We know that in ecosystems, one of the functions of naturally occurring fires is to clear out “deadwood,” to allow healthy new growth to occur. In fact, some types of seeds seem to require smoke for germination. When inadequate natural burning takes place, bushfires as seen in Australia and forest fires as seen in California become an increasing problem.

Deaths from pathogens seem to play a similar role in human economies. This is especially the case with pathogens that especially target the weak and old. Most flu viruses have this characteristic. Early reports of deaths from the coronavirus suggest that this same pattern of targeting the old and weak is occurring with this virus as well. As noted above, the median age of those dying from the new coronavirus seems to be about 75 years.

Since the 1940s, modern medicine has been able to develop antibiotics and vaccines to counteract the impact of many pathogens. This, of course, makes citizens happy, but it has the disadvantage of changing the population in a way that leaves the economy with a much higher percentage of elderly people and others in poor health. This higher level of elderly and medically needy people makes it easy for viruses and other pathogens to make their rounds, just as leaving deadwood on the forest floor makes it easier for fires to spread.

With this rising population of people who cannot support themselves, tax rates for the remaining citizens tend to become very high. Young workers may become discouraged because they do not have enough income remaining after paying taxes to raise their own families. In effect, they cannot support both their young families and the many old people.

Viewed from this unusual perspective, the operation of the Chinese coronavirus might even be considered a benefit to society as a whole. The world has overcome the impact of measles, typhoid, polio, and many other diseases. In some sense, it “needs” a new disease added to its portfolio, to replace the ones that have been mostly taken care of by modern medicine. In this way, pensions and other payments targeting the old and weak don’t become too great a burden on the young.

[3] If the Chinese coronavirus were simply allowed to run its course, without publicity that it was in any way unusual, somewhat less than 1% of the world’s population might be expected to die. 

To see what would happen if the Chinese coronavirus were to run its course, we might look at what happened with the Spanish Flu, back in 1918. At that time, doctors did not have a way of treating the virus and authorities downplayed concern for the disease. The US Center for Disease Control reports that 500 million people, or one-third of the world’s population, became infected. At least 50 million people (about 10% of those infected) died.

We don’t yet know with accuracy how many of those infected will die from the current virus. A recent estimate is that about 2.3% of those who are infected will die of the disease (based on 107 dying out of 4,600 infected). If we assume that the percentage of the population that will ultimately catch the new virus is 30%, then the share of the world’s population that would be expected to die would be about [(1/3) x 2.3% = 0.76%].

The UN estimates that the world’s population can be expected to grow by about 1.05% in 2020. If this is the case, the effect of the Chinese virus would be to sharply dampen the population increase for the year. Instead of population rising by 1.05%, it would rise by only 0.29% (= 1.05% – 0.76%), assuming all of the deaths associated with the Chinese coronavirus take place within a year. While this would be a change, it would be a fairly small, temporary change.

All of these deaths would be tragic for the families involved but, in a way, they would be less of a problem than the deaths that took place back in 1918. At that time, mortality was high for healthy 20- to 40-year olds, making the flu particularly disruptive for families. The total percentage of the population that died was also much higher, about 3% instead of 0.76%.

[4] A major danger of the virus seems to be one of overreaction.

Today’s world economy is fragile. China, like other countries, has a large amount of debt. Debt defaults related to poor profits of companies closing their operations for a time and workers losing income could easily skyrocket.

Closing down transportation from China would risk pushing the world economy into a very bad recession. In fact, simply having a very large number of people out sick from work would be expected to have an adverse impact on the economy. Spending a large amount of money on hospitalizations and face masks cannot compensate for the loss of productivity of the rest of the economy. Thus, the tendency would be toward recession in China, even if no action toward cutting off travel were taken.

China is a huge supplier of goods to the rest of the world. In fact, in 2016, it used more energy in producing industrial output than the United States, India, Russia and Japan combined.

Figure 1. Chart by the International Energy Agency showing total fuel consumed (TFC) by industry, for the top five fuel consuming nations of the world.

China’s economy has been growing very rapidly since 1990. Figure 2 shows this one way, in GDP comparisons using inflation-adjusted US dollars.

Figure 2. GDP of China and the United States, computed as percentages of World GDP. All amounts in 2010 US dollars, as provided by the World Bank.

Figure 3 is similar to Figure 2, except the growth comparison is made in “2011 Purchasing Power Parity International Dollars.” This adjustment is made because typically the currencies of less developed nations float far below the dollar, in terms of what the local currency will buy. The inflation-adjusted PPP comparison compares output on a basis that is expected to be more consistent with what the local currency will really purchase.

Figure 3. Ratios of the GDP of China and the United States to the World GDP. All amounts in 2011 Purchasing Power Parity International Dollars, as provided by the World Bank.

On this PPP basis, China’s GDP surpassed the US’s GDP in 2014. Figure 3 also shows that the United States has slipped from about 20% of the world’s GDP to about 15% on this basis.

We cannot simply cut off trade with China, regardless of how bad the situation is. China is too big and too important now. The rest of the world desperately needs goods and services produced in China, in spite of what is going wrong from an illness perspective. China plays too key a role in supply chains of many kinds for the country to be left out.

Even cutting off tourism becomes a problem. The share of China’s revenue from tourism amounted to 11% in 2018. While not all of this would drop off, even a dip would lead to lower employment in this part of its economy. Jet fuel use would drop as well.

[5] A particular problem today is low prices for many commodities, including oil and other fossil fuels. These prices are likely to fall further, if China’s economy falters further. 

We used to hear that the world would “run out of” oil and that oil prices would rise very high. In fact, if the people who were concerned about the issue had studied history, they would have figured out that a far more likely outcome would be “collapse.” In such a situation, prices of many commodities might fall too low. Revelation 18:11-13 provides a list of a number of commodities, including humans sold as slaves, for which prices dropped very low at the time of the collapse of ancient Babylon.

The problem is a different squeeze than a high-price squeeze. It is more of a growing wage disparity problem, with fewer and fewer of the world’s workers being able to afford the goods and services made by the world economy. This problem feeds back to commodity prices that fall too low for producers of many types. The problem is an affordability issue, rather than one of running out. I have written about this issue many times.

Prices of fossil fuels have been low for a very long time–essentially since late 2014. OPEC has cut back its oil production because of low oil prices. Several US natural gas producers have taken big write offs on natural gas investments. China’s coal production has remained below its 2013 level, because of low prices.

Figure 1. China energy production by fuel, based on 2019 BP Statistical Review of World Energy data. “Other Ren” stands for “Renewables other than hydroelectric.” This category includes wind, solar, and other miscellaneous types, such as sawdust burned for electricity.

If China finds it necessary to cut back on production of goods and services for any reason (excessive sickness within China, visitors aren’t traveling to China, tariffs, customers around the world aren’t buying cars), this reduction in output would be likely to further lower the prices of commodities. More producers would go bankrupt. Countries exporting products as diverse as oil, iron ore, copper and lithium might have economic difficulties.

Lower fossil fuel prices may lead to a cutback in their output, but it is doubtful that this cutback would be offset by an increase in the production of renewables. Falling fossil fuel prices would make the price comparison of renewables to fossil fuels look even worse than it does today. China has cut back on its subsidies for solar panels, and this has led to decreasing Chinese solar installations in both 2018 and 2019.

[6] The best approach might just be to let the Chinese coronavirus run its course. Authorities might also discourage stories about how awful the illness is.

Today, we seem to think that we can fix all problems. Unfortunately, this medical problem doesn’t seem to be fixable in the near-term. We should probably do as governments through the ages have done, which is not very much. We should not publicize the disease as being a whole lot worse than flu viruses in general, for example.

We should certainly look for inexpensive treatments for the disease. For example, there seems to be an effort to examine the possibility of using existing antiviral drugs as a treatment. It seems like an effort could be made to look into ways of treating the disease at home, perhaps using supplemental oxygen for a period. In time, perhaps a vaccine can be developed.

Individuals around the world should be encouraged to get themselves in as good health as possible, so that their own immune systems can fight off pathogens of all types, not just this particular virus. Common sense should be used in washing hands and in avoiding being with sick people. I doubt that it makes sense to encourage the use of masks, goggles and other protective devices.

We, as individuals, cannot live forever on this earth. We also cannot spend an unlimited percentage of GDP on health care: It becomes too high-cost for most citizens. At some point, we need to call a halt to the expectation that we can fix all problems. We live in a world with limited resources. We need to start lowering our expectations, if we don’t want to make our problems worse.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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1,772 Responses to It Is Easy to Overreact to the Chinese Coronavirus

  1. Ed says:

    CV19 still no honest numbers of the ill rate nor the number infected. I a bad flu year 60,000 die in the US. With China having 4x the population that would be 240,000 dead from just the flu.

    I am waiting for 250,000 dead in China and no end in sight and/or a kill rate of 5% or more. So far just smoke (no pun intended).

    • Harry McGibbs says:

      We don’t know for sure yet but COVID-19 appears to have a higher mortality rate than flu plus it is *novel* and verging on pandemic, not endemic like flu. This means that there is no heard immunity, no vaccine and it is totally overwhelming health systems in China in a way that flu does not, and as it may well do in other nations. It could also mutate.

      Gail is making the point that the economic knock-on effects are potentially dire and not just for China, which is an impossible bind, as continuing to pursue a policy of aggressive containment will come at an economic cost it cannot afford.

      • Harry McGibbs says:

        “Herd immunity” not “heard”, lol.

        • Chrome Mags says:

          https://www.washingtonpost.com/world/asia_pacific/coronavirus-china-live-updates/2020/02/14/6806aa08-4eb8-11ea-b721-9f4cdc90bc1c_story.html

          Speaking of which, ‘More than 1700 medical workers infected’

          That’s bad news, because if medical workers go down there isn’t necessarily many qualified to take their place, but also because there will be fewer to help while numbers of infected/critical rise.

          • Hopefully, once health care workers have had the disease, they will be immune, at least for a while.

          • Davidinamonthorayearoradecade says:

            “Covid-19 affects the respiratory system and can put people at risk of bacterial infections there, further raising the risk of deadly complications.”

            • Davidinamonthorayearoradecade says:

              “Singapore announced nine new coronavirus cases Friday, including that of a 61-year-old general anesthesiologist. The doctor is case 59 out of 67 total infections and the first health-care professional known to have contracted the coronavirus.

              In an interview with Singapore’s Straits Times newspaper, the unnamed doctor said Friday that as recently as Feb. 6, he was well and working in the operating theater. After coming down with a fever, he went to a hospital on Sunday and was told he had coronavirus Thursday morning.

              He told the newspaper that he had not traveled to China for more than a year and that he had no known interactions with cases of coronavirus.

              “I am just unlucky. That’s all I can say,” he told the Straits Times.

              Asked how he could have come into contact with the coronavirus, he said: “I don’t know. No idea at all.”

              wow… NO IDEA AT ALL…

              how quaint that they are (still) numbering the cases…

              that won’t continue for long…

              soon the cases will be in the thousands and then tens of thousands…

            • Quite a few people in China (800,000 according to a US CDC article) have tuberculosis. When you put that together with all of the pollution they have been breathing, people in China have lungs that are very stressed. When Covid-19 and bacterial infections are added to the mix, there is a real problem.

        • Hubbs says:

          Well, I haven’t “heard” about any immunity to it yet, so you are still correct.

          • Chrome Mags says:

            How about this footage from Wuhan! Remember the family they pulled from their apartment, the guy that needed several men to haul him out, well amongst other stuff is the continuation of that battle at the van. The guy somehow pulls himself under the van, then they have to pull him out, but what a big struggle.

            Another part there’s a woman that’s lost it for some reason and is pulling down barricades but no one will get near to try and stop her – is that a mask she’s wearing? There’s also footage of a teen girl being pulled from a car – it takes 3-4 people to get her out then she passes out.

            But the most combative scenes are when they take two women and a man out of their apartment on to the street and the battle that first woman puts up is relentless. She absolutely refuses to be subdued. She’s yelling the whole time. Must see Wuhan misery.

            Oh, there’s also two middle aged men that are trying to stop someone in a van from driving off and you don’t see what happens for a moment, but then they are laid out on the ground and can’t get up. I don’t know if the van drove over them or what.

            • Chrome Mags says:

              In this one some woman is not allowed into a certain district so she jumps off a bridge. It’s not too high, so she was likely ok. Then some scene where a guy has folded money into planes and is flying them out his apartment window, with the caption money loses value in Wuhan.

    • JesseJames says:

      This thing appears to be very communicable while undetected. I anticipate it will therefore, sooner or later, be everywhere. The real danger is that the present death rate being communicated are those that receive diagnosis and then intensive treatment. The non-treated death rate is what I want to know. Because all hospitals will be overwhelmed, and there will not be drugs available, therefore it will be you and your immune system fighting it and no more. That is the death rate you need to be concerned about.

      • I am afraid you may be right. It will be too expensive to treat everyone and the system will be overwhelmed in most places.

        We can cross our fingers that a few antiviral drugs can be ramped up quickly. These won’t completely solve the problem, but they might make the illness more bearable for quite a few people.

    • This disease is scary in many ways:
      1. It spreads rapidly from one person to another.
      2. It appears as though a person who catches the disease can at least some of the time start spreading the disease before he shows symptoms.
      3. We don’t really know how long the incubation period is, before a person comes down with the disease. The new Los Alamos paper says the average of the cases they looked at was 4.2 days. The outside limit people have been assuming is 14 days, but it could be longer than this. It is often difficult to know when exposure took place.
      4. The average time from onset of symptoms to hospitalization 5.5 days, based on the Los Alamos study. After January 18, it shortened to 1.5 days, when the issue was publicized.
      5. The average time from hospitalization to discharge was 11.5 days; the time from hospitalization to death was 11.2 days, according to the Los Alamos paper.

      We are talking about a lag between exposure and death of something like three to five weeks. By the time that lag occurs, the new exposures and hospitalizations have skyrocketed. Cases will be skyrocketing.

      We need to be looking at the ratio of people discharged from the hospital well to the total discharged from the hospital (dead or alive), and then adjusting that for people who never were sick enough to go to the hospital. Or we need to be “grossing up” the death rate by a factor to reflect the expected rapid rise in the count of hospitalized cases. The death rate could very well be 5% or more, especially if not much treatment can be given in the hospital. The death rate may be fairly variable, depending upon the type of medical facilities available, and whether any antiviral drugs can be used.

      We are looking at the tip of the iceberg. The problem is figuring out how to interpret what the whole iceberg looks like. And even if it is a lot of people, China and other countries can’t just close up shop to fight the virus, or people will die from lack of food and other necessities.

      • Chrome Mags says:

        “The death rate could very well be 5% or more, especially if not much treatment can be given in the hospital.”

        I think you’re right about that, because if you see the post I did further down the thread, Martenson is saying evidence is coming in it’s possible to become re-infected after surviving an initial bout, and then die from heart failure, because the heart is so damaged from the first time the person had the virus.

        And one video I posted higher up was of a man they found laying down motionless, that they tried to get his heart going again. That footage seems to suggest that the use of a refibrilater is being used because the reason people are going down is heart failure, not the lungs.

        A virus that spreads in a multitude of ways, shows no symptoms for days while it can spread wildly, then once the person has it, it damages the heart, then re-infects and kills via heart failure. Isn’t that the absolute worst case scenario for a pandemic? We can all take a lot of abuse physically and survive, but if something goes after the heart, then that’s really hard to overcome.

        I’m starting to smell a rat so to speak, meaning if someone or a group of people wanted to develop the worst case scenario pandemic virus, wouldn’t this be it? I can’t even imagine tweaking it to be worse. Keep in mind if a virus kills too fast it’s much easier to quarantine like with ebola, so it has to sneak up on people in a way they can’t do much about it.

        • Xabier says:

          True, but Mother Nature herself is sneaky like that, we needn’t suppose that it has been engineered simply because it is so deadly – although it may well have been, or even a vaccine experiment gone horribly wrong.

          Good hygiene and make one’s will and testament, that’s all that there is to be done now.

        • Tim Groves says:

          If I were to team up with Prince Philip to develop the worst case scenario pandemic virus, I would suggest opting to modify the myxoma virus to infect H. sapiens. Then we would have the mother of all pandemics on our hands.

          Mmyxomatosis is the name of the severe and often fatal disease in European rabbits caused by the myxoma virus. Different strains exist which vary in their virulence. The Californian strain, which is endemic to the west coast of the United States and Baja in Mexico, is the most virulent, with reported case fatality rates of 100%. The South American strain, present in South America and Central America, is slightly less virulent, with reported case fatality rates of 99.8%. Strains present in Europe and Australia have become attenuated, with reported case fatality rates of 50%-95%. While wild rabbits in Europe and Australia have developed some immunity to the virus, this is not generally true of pet rabbits.

      • Robert Firth says:

        Gail, this is the result of a single afternoon’s work, so don’t take it too seriously. It is based on the data publicly available, but pays most heed to the data from Singapore, because in my opinion (as a former member of their Smart Health initiative) it is trustworthy.

        First, the official death rate is approaching 15%, but that is an overestimate, because while it counts the dead correctly, it undercounts those infected, many of whom are asymptomatic. Factoring in the incubation time, my best guess is 3% to 4%.

        However, that is in a small first world city state with excellent healthcare and a paternalistic government not afraid to intervene. The situation does not look as good elsewhere, and in the poorer, overpopulated countries of the world, many of which are heavily polluted and plagued with food scarcity, degenerative disease and the like, things will be much worse.

        Enough rambling. My bottom line (today at least) is this: the virus will infect about 65% of the world population, and the death rate will vary from 5% to 6% in countries better prepared, and 15% to 20% elsewhere. Since the latter comprise the bulk of our species, my tentative guess is that we stand to lose about 900 million.

        • You may very well be correct.

          Once we factor in the disruption to the economy at the same time, there will be indirect impacts that are hard to measure. The financial system will be badly disrupted. Debt defaults will be a major problem.

          I would not be surprised if the government of China collapses. I don’t know whether the individual provinces would each go their own way. In the case of the Soviet Union, that is what happened. I understand that the provinces have quite a bit of autonomy now. How about a new system in which each province has its own currency, for example? That would make life interesting.

          All of the wind and solar put in up in the Northwest was for the benefit of the folks in Beijing and others toward the coast. I wonder how it, together with all of the transmission lines, would be handled if separate governments were involved. New additions have been way down, even before the current crisis.

        • Artleads says:

          Thanks! Very helpful that somebody can figure this out.

  2. So, I heard a private study showed 90% SARS and 10%bat flu and HIV.
    If this was just a case of pneumonia why would it cause organ failure. Sounds like HIV

    • Duncan Idaho says:

      Nope-
      96% similar to a bat virus from 2013.
      A double stranded positive RNA virus, with an original bat origin.
      Could have a host between us and the bat.
      We don’t know yet. if ever.
      Not remotely related to HIV, but not far from SARS, which disappeared in 2014.

      • Duncan Idaho says:

        The other two coronavirus (other than some minor cold type viruses) are SARS and MERS. MERS is still with us, with camels the host, but a bat origin also.
        So campers, all three human coronavirus have a bat origin.
        All attempted vaccines have failed.

        • squideater says:

          Thanks Duncan. Why has cv19 spread so much faster than SARS? Do you think CV 19 has a better chance of a vaccine being developed? Do you think it will peak and be gone like SARS or escape containment and be a significant pandemic. You seem informed and have throughout the posts about this so would like to know your opinion/guess. SARS plus or uncontainable economy killer?

          • There seems to be a big difference in the extent to which the diseases are transmissible among humans, among other things.

          • Duncan Idaho says:

            A vaccine is at least 18 months away, and that is if everything goes right.
            As far as spread, it seems there is a 4-7 day period where the patient has no symptoms, but is contagious (this still needs to be verified).
            SARS was only contagious during fever, so isolation was possible.

      • There was a study released in India, published by drs and then retracted as the WHO joined up with china. Conveniently it’s been overlooked now. I’ll try to find the screen shot of the study. It certainly has some HIV

  3. Herbie R Ficklestein says:

    Partners in misery Renault and Nissan
    https://finance.yahoo.com/news/renault-plans-2-2-billion-131321183.html
    A no-taboos commitment to cut costs by 2 billion euros ($2.2 billion) over the next three years from the carmaker on Friday, as it tries to put the Carlos Ghosn affair behind it.
    As ex-Volkswagen brand manager Luca de Meo prepares to take over as chief executive of the French automaker, which has been rocked by the Ghosn scandal, it did not exclude job cuts in a promised review of its performance across all factories.
    Like many auto industry rivals, including its alliance partner Nissan, Renault is grappling with tumbling demand in key markets like China, and said it expects the sector to be hit further this year, including in Europe.
    In a reflection of this sobering assessment of the market outlook, Renault set a lower operating margin target of between 3% and 4% for 2020, down from 4.8% in 2019, and cut its proposed dividend against 2019 by almost 70% from a year earlier.
    While Renault faces high investment costs to produce cleaner car models and supply chain problems due to China’s coronavirus outbreak, a major challenge remains moving on from the scandal involving former boss-turned fugitive Ghosn, which strained its relations with Nissan and paralysed joint projects.
    “It has been a tough year for Groupe Renault and the alliance,” acting Chief Executive Clotilde Delbos said on a conference call, adding that the broader autos downturn had hit the company “right when we were facing internal difficulties.”
    Renault could not afford to wait for De Meo’s arrival in July to attack costs, Delbos said, adding that nothing would be “taboo” as it reviews its business.

    What Bloomberg Intelligence Says:
    ‘Nissan’s worse than expected 3Q result and dividend will clearly have a knock on effect on Renault’s own pre-tax result and dividend payout, but the key task going forward for the two new CEOs is to provide an update of their 5-year plans and put in place a recovery strategy for Nissan.’

    — Michael Dean, senior European auto analyst

  4. Stephen says:

    Covid19 is initiating a trend of converting much of our world’s interconnected systems and infrastructure ( jit supply chains, cruise ships, airliners etc ) into stranded assets.

    This virus is quite unlikely to abate in spring as one leader has suggested.

    • Chrome Mags says:

      “This virus is quite unlikely to abate in spring as one leader has suggested.”

      That’s a video by Martenson, which is long winded, so I’ll paraphrase the key parts. He’s saying there’s early evidence now that people recovering from the virus are susceptible to re-infection, and the 2nd time they have it there is a danger of heart failure because the first time they had it, it weakened the heart.

      He also mentioned that the Spanish flu killed the most people the 2nd time it went around the world, as an analogy to what may be happening with Corona virus.

      Also, certain groups of people are more susceptible, such as smokers and the obese. In Wuhan they may all in a sense be heavy smokers because of industrial air pollution, as one poster pointed out.

      • Interesting. One thing I hadn’t realized was that the reason the attempted SARS vaccine failed was because after it was given, it tended to make a second exposure worse, not better. The body tends to over-react to the virus the second time, and it is the over-reaction that kills.

        This reminds a person of the economic challenges. Over-reacting to the virus cuts off commerce. This can kill the economy as a whole. Ultimately, the failing economy can kill from lack of food, fresh water, and other essentials.

        • Xabier says:

          Over-reacting can kill the global economy: true even of the more localised economies affected by earlier plagues, and more so now we have made China the workshop of the world and become so inter-connected.

          Under-reacting, allowing it to spread unimpeded (as it seems it must anyway) may lead to the loss of too many key and irreplaceable workers -and hence their products and services – exacerbated by our hyper-specialisation.

          Quite a conundrum…..

          • A no-win situation! If it is possible to put off the worst of the attack, there is the hope that there will be some sort of antiviral drug available, or that the peak of the problem can be spread over a longer period, reducing the overloaded hospital problem.

            • Xabier says:

              If we consult the observations of the US CDC, it is clear that is what they are hinting at – above all attempting to avoid the over-loading of hospital systems through tele-working and diagnosis, etc, among other things, closure of schools and so on.

              The MSM is so very quiet about all of this that I suspect some very feverish work is going on behind the scenes and they have been ordered not to panic their readers.

              I am somewhat convinced that cases, and even deaths, are being hidden, while their contacts are being hunted down in an attempt to contain, and also find infected subjects to study and experiment upon before it all explodes too obviously.

    • Xabier says:

      The idea that it will abate in the Spring is largely a political notion with no foundation in medical likelihood: the CCP would like it to do so, meaning only a temporary first quarter hiccup in China’s growth. Nothing more than a fairy tale from the East. No one has a clue at this stage.

      • squideater says:

        Well we dont know. SARS peaked and abated. MERS peaked and abated. Yes CV19 seems to have characteristics that make it less likely to do so. Transmission seems higher. Transmission with no symptoms for longer. A virus that hides. If we could see a peak of under 250k without worldwide exposure that would be a victory IMO. A peak could happen in the next three months. This thing will be with us for a while IMO. Right now we dont know.

        CV19 seems to tax isolation procedures to their limits because of its transmission when there are no symptoms. A virus that transmitted long enough without symptoms would seem to negate vector isolation containment because it could be transmitted one two three four times with none of those infected showing symptoms and thus no ability to determine vector and contain. From the numbers presented there seems to be a possibility of small overlap where someone could be transmitting CV19 while the person that infected them is still not showing symptoms.

        SARS and MERS had pretty straightforward transmission vector containment. The fact that geographic rather than vector containment is being resorted to in China is very concerning. Geographic containment is basically a admission of the failure of the primary method vector containment IMO. Already we see Vietnam resort to geographic containment. We dont know how well geographic containment will work. Even Vegas isnt giving odds on any of this yet.

        Outside of China and Vietnam vector containment seems to still be functional. There seems to be widespread belief that CV19 can be contained via vector procedures and geographic containment in china is due to not knowing that a new virus existed while it spread. We will just have to wait and see. Until we see a peak and decline in cases in China the belief that it can be geographically contained is just a theory. Let us hope.

        The disturbing part is every country has to be on the ball and have the resources to be on the ball or fall back on geographic containment. Even geographic containment takes significant resources. Every concession to geographic containment guarantees many many people will be infected. Its really quite unthinkable. The psychological effects alone are significant. Unity is broken. Can it be easily reformed? As we see in china the line has to be drawn somewhere. If family is on the other side there are problems. People will break quarantine. A geographic containment is akin to enemy occupied territory in wartime in my mind. If quarantine is broke there has to be a fall back and new lines formed. Without even a shot fired. And people are supposed to just go back to b4 after its over tralalala?

        Geographic containment means trade comes to a end. As mentioned ships and planes get parked. Crickets chirp and moss grows. Entropy. How basic resources that sustain human life are distributed and quarantine kept is unclear. Truck drivers getting quickly schooled in HAZMAT? As previously mentioned can the food even be produced in order to distribute with geographic containment in place in networked economies?

        There seems to be significant risk to networked and complex just posed from a few extra days of transmission without symptoms. That alone seems to have the possibility of cv19 becoming something the likes we have not seen in our lifetimes. The unknown is how well the virus hides in a host without symptoms. If cv19 can hide…

        Time will tell. Doomster paranoia or accurate analysis.

        • Great points, thanks. Few days ago the French news channel invited over an american epidemiologist who stressed interesting thing that from certain threshold the Chinese govs gave order for implementing full defense against SARS like outbreak for which there is after two decades not much antidote anyway, apart from hard hitting quarantines (and perhaps digital trail hunting of super spreaders etc). And as we learned recently this is more virulent strain able to jump through it (also thanks to long and asymptomatic incubation period and other features).

        • Xabier says:

          Trade and associated movement will simply have to continue, and it will be necessary to live with the inevitable losses in life, perhaps on an annual basis.

          Brutal certainly, and perhaps rapid financial collapse and bankruptcy of key companies and the loss of essential skilled workers in a short time-frame will undermine even this approach, which accepts huge loss of life as a fact to which we can only bow. .

  5. Davidinamonthorayearoradecade says:

    Singapore is reporting data which probably would be equivalent to how things started to progress in Wuhan in December…

    update:

    https://www.scmp.com/week-asia/health-environment/article/3050726/singapore-nine-new-coronavirus-cases-no-plans-raise

    “Singapore on Friday reported nine more cases of the deadly coronavirus, bringing its total number of cases to 67.
    This is the largest one-day surge so far after the city state recorded eight cases on Thursday.”

    these may seem like tiny numbers, but the Wuhan numbers must have been tiny also at the onset in December…

    Singapore reported 22 total cases in travelers from China which became 25 MORE local cases then 28 then 36 and now 45…

    “If you look at H1N1 and the flu pandemic in 2009, 10 per cent to 20 per cent of the global population contracted the illness. In Singapore alone, more than 400,000 people got ill from H1N1 in less than a year.
    “But because the transmission patterns are similar to H1N1, we should be prepared for a scenario where you get wider transmission [of Covid-19] around the world,”

    it’s almost hard to imagine 67 cases becoming 400,000 but that is what happens with an exponential increase in infections, which is happening NOW…

  6. Xabier says:

    We should keep in mind, in the face of these rather unnerving stats, that 80% or so of cases are mild and not dangerous at all (even just a mild sore throat): even if reinfected – as seems to be possible- these people will probably not have damaged hearts and will have good prospects of survival.

    Anyway, that’s what I’m keeping in mind: and the mind has much to do with prospects of survival in all illnesses. Gosh, never thought I’d be the resident site optimist…. 🙂

    Supply chain disruption, even destruction, and severe generalised economic damage are perhaps the real existential threat.

    • Xabier, I hear you, but it is still very early, and the potential for further mutation, post recovery (delayed) severe organ damage, or reinfection are on the table..

      Hopefully, we will get in few weeks time better picture how (and if at all) it spreads with similar impact-consequences among other races and climates. In preliminary scenarios discussion with my extended family (incl. doc and medical staffers) should the case evolve into similar situation and true global pandemics scaling: meaning post panic phase w. over crowded hospital & ICUs, heavy handed quarantines (+enforced gathering centers), etc. it would be rather desirable to avoid/skip this entire nonsense completely and “treat it” in home setting instead. There are still many options how to prepare for it from respiratory drugs, antibiotics and imunosuppression medicament angle, also having small scale oxidization concentration unit at hand (still available for purchase now – for how long?) and so on.

      In short, if infected staying put home, and the goal being just to alleviate the pain-stress from (e.g. acute lack of oxygen at least in the “basic” inhaling form) – there is no point spending last moments alone among strangers in a hell hole hospital environment of self infecting pandemonium cycle of personal and patients. Currently I gave it ~1-5% chance, when situation worsens say to ~15-25% probability lets give it a go.. Call it selfish or insane at this point – premature worry, but in worst case scenario it seem as sensible approach.

      • Xabier says:

        Oh yes, I agree, the possibility of a more lethal second infection, the mutation to something more deadly is there and not at all negligible: but, after some severe illnesses, my mental attitude is to face straight into the storm with confidence. If you are proved wrong, you just die: but if not, you will have been less fearful in facing it. The danger in being forewarned is to be more terrified……

        I

      • Christopher says:

        Elderberries have some antiviral properties. Some studies confirm this, a recent one:
        https://www.sciencedaily.com/releases/2019/04/190423133644.htm

        May be better than nothing, especially accompanied by the placebo effect.

        • Xabier says:

          Folk remedies are never to be despised, and it makes a delicious tea, with honey. Quite widely available, too.

      • Curt Kurschus says:

        Having the infected stay at home rather than in a hospital sounds like a bad idea. If the infected are in a hospital, it is a central location to which to deliver food and medical supplies and from which to stop people leaving. If they are at home then they are likely to be widely dispersed making for greater difficulty in supplying food and medicines and in preventing so many people from going out and spreading the virus.

        • The context of the suggestion to stay home was in situation of pandemic and clearly over loaded hospitals – medical system like in Wuhan, the epicenter so far. We don’t know if this kind of sheer intensity will be replicated around the world eventually, that’s why the probabilities. And if it comes to it, well it’s also up to you if you want to like “good little pupil” perish in some over crowded ward waiting with only token help provided anyway..

    • Artleads says:

      Great points. Looks like we’d be well served by doing all the hopeless fixes in combination, including immune system strengthening and Zen-level cleaning of hospitals, turning them into a lifestyle, while simultaneously putting the VIRUS out of mind. Doing two opposite things at once.

  7. Xabier says:

    The interview with the expert Lipsitch at Harvard is very good and balanced.

    The surprising absence of cases internationally is due to inadequate testing and silent asymptomatic spread of the virus – countries which should have a lot of cases by now, based on intensive travel links with China, have few or none and that really makes no sense at all.

    Lack of testing programmes, problems with the reliability of the tests, etc rather than deliberate concealment play their part in this.

    Singapore is testing efficiently and therefore coming up with more cases.

    He is doubtful about warmer weather having much beneficial effect -thinks SARS was contained and did not go away with rise in temperatures.

    Most important conclusion: this is uncontrollable and ‘uncontainable’, and the main aim should be to prepare so that hospitals are not overwhelmed by a tidal wave of serious cases and chaos.

    It can only be managed, and one should not place any great faith in the development of a vaccine.

    • Yes, if the incubation period is ~month and also the virus could “be dormant” inside some organs for weeks the current testing apparatus is obviously ill equipped to be of help, actually it could be even contra productive – helping to spread the virus through int transport hubs.

      Sorry, there is logical error in the other part. Singapore is a city state with large (predominant?) ethnic Chinese pop, so if there is for whatever reason racial bias in this thing it will eventually pop up in the Singapore case statistics soonish as well.

    • Yoshua says:

      “I talked to Clemens Wendtner, who has been treating some of the German patients. He told me Monday evening that of four #COVID19 patients he had been treating for two weeks, three were still PCR-positive even though based on symptoms they would have been sent home by now.”

      One medical staff in China was infected by a patient that was supposed to have been cured.

      A tricky bug.

      • I can see this would be a problem. Still being able to infect others, even after a person looks to be cured. Given the expense of the tests, and the fact that they tend to produce a lot of false negatives, I can imagine a lot of people being sent back into the community who still seem to be capable to give the illness to others.

    • Artleads says:

      So if every “solution” is full of holes, all the sensible (modest) ones in combination is better than nothing. A works program to keep hospitals Zen clean could be helpful perhaps. So could staying home, washing hands, etc.. So would be anything to help the immune system…

      • Xabier says:

        Yes, everything is flawed, but everything has to be tried.

        All that can be done is to try to stagger and break the – ultimately unstoppable – flow of contagion, buying time.

        Good hygiene routines will certainly help, as they did in the days of TB and typhus; but it needs only a few people to disregard them or become careless for the efforts of everyone else to be rendered useless, given the highly contagious nature of this virus and the way it persists on surfaces.

        When hospital visiting in 2018 in London I was appalled by how few people used the hand-wash placed at the entrances to wards, young men being by far the worst. Everyone using public toilets will know how few wash their hands.

        On more than one occasion people only stopped to use the dispenser at the hospital because they saw me doing it. The nurses who opened the doors remotely didn’t make people wash their hands as a condition of entry, which they should be able to monitor – really very slack.

        • Artleads says:

          It seems that the virus forces a very broad cultural change that we would have needed anyhow. If we hope to hang on with very little fossil energy, we may need to be cleaner–all we’ll have are folk remedies, and so can’t afford the illnesses abundant energy seems able to handle now. It’s going to take very active government, and fiendish creativity to get people to was their damn hands, though.

  8. Xabier says:

    Estimated reserves of parts in the automobile industry seem to be 12 weeks maximum.

    One wonders how other industries compare?

    Supply chain-wise, the biggest problem is sole-source parts.

    This is really the ‘Phoney War’ phase, as in Europe late 1939 -early 1940: it doesn’t seem at all likely that Chinese industry will get going anytime soon, so we can anticipate severe impacts.

  9. Xabier says:

    Interesting to see -in so far as we will be permitted! – the outcome of the Chinese containment strategy in Beijing.

    They clearly hope to be able to identify and extinguish the infection as it appears , in a pro-active way after the gross mismanagement of the outbreak in Wuhan.

    • Chrome Mags says:

      https://www.worldometers.info/coronavirus/

      Here’s something not talked about in the news, and that is on the linked site that has official virus count, 15% of all Closed Cases are deaths. Closed Cases total: 10,127 of which 8,600 (85%) recovered & 1,527 (15%) dead. The other numbers it provides are for Active Cases with 57,067 of which 45,985 (81%) are deemed mild symptoms and 11,082 (19%) are in serious or critical condition.

      Now I realize those are official numbers which is only part of the total, as many remain in their homes without testing and so on, however even based on those stats, of active cases 19% in critical and of closed cases 15% dead. Those stats do not bode well should this virus go completely pandemic. Sure it’s in several countries so far, but it would need to do what it’s doing in Wuhan for it to be a full blown pandemic. That said, if it did go full on pandemic, and let’s say 20% of the worlds population got the virus and 15% of those pass away, that’s 225 million. That’s so substantial it suggests the world economy would likely fold due to reduced commerce and travel, with reduced currency velocity. Currency has to change hands at a certain pace or the economy caves in.

      • There are so many things that go wrong in a networked economy. Think about all the debt that cannot be paid back. And all of the companies that are no longer making more products each year. They scaling back, because they have fewer workers and customers. They likely cannot get needed raw materials, either.

        • Interestingly, in recent years both Gates and Soros funded think-tanks/NGOs ran dry run scenarios of corona virus outbreak or food shortage collapse for the ~2020 horizon. The US army is now authorized on domestic soil for performing and assisting with quarantine and mortuary situations. So, I guess our worries about the elevated risk as in “collapse of networked global economy” could be merely naive and just observed from the wrong vantage point. Perhaps the key focal point is not to have such type of the economy anymore.. What specifically should come next is beyond my pay grade, although drastically lower consumption pattern per capita would be one of the likely vectors..

          • David Korowicz has a paper from 2013 called, Catastrophic Shocks Through Complex Socio-Economic Systems: A Pandemic Perspective

            The summary says

            Summary

            The globalised economy has become more complex (connectivity, interdependence, and speed), de-localized, with increasing concentration within critical systems. This has made us all more vulnerable to systemic shocks. This paper provides an overview of the effect of a major pandemic on the operation of complex socio-economic systems using some simple models. It discusses the links between initial pandemic absenteeism and supply-chain contagion, and the evolution and rate of shock propagation. It discusses systemic collapse and the difficulties of re-booting socio-economic systems.

            Notice the part about the difficulty of rebooting.

    • Identifying and extinguishing each infection as it appeared clearly did not work on the cruise ship docked off of Japan. The one person known to have the infection was on the ship from January 20 until January 22. The quarantine began February 5, after the fact that the one passenger had tested positive became known. 10 passengers tested positive for the virus at that time. Now (Saturday, Feb 15) there are at least 285 with the virus, up 67 from the previous report of 218.

      One of the issues is how long a virus can retain the ability to be infectious while on a surface. A new study indicates that germs on a inanimate surface can retain their ability to infect people for over a week.

      Reviewing the literature on all available human and veterinary viruses within this [coronavirus] family, encompassing 22 studies, researchers have found that the human pathogens can persist on surfaces and remain infectious at room temperature for up to nine days. (To put that in perspective, the measles virus can live on contaminated surfaces for up to two hours.)

      Granted, that’s the upper end of a coronavirus lifespan, but on average, researchers say this family of viruses can survive between four and five days on various materials like aluminium, wood, paper, plastic and glass.

      Some of the veterinary coronaviruses – the ones that can only infect animals – could even persist for longer than 28 days.

  10. squideater says:

    From wikipedia
    “On 6 February, the Chinese National Health Commission started to change how cases were reported – asymptomatic carriers, who tested positive for the virus but did not show clinical symptoms, would no longer be included in the number of confirmed cases. This had the effect of reducing the total number of cases reported, but also meant that potentially contagious individuals were ignored in reports.[61][62]”

    Apparently the population of asymptomatic carriers of the virus is significant enough to change reporting practices. Why would you ignore ” potentially contagious individuals ” especially if they were the ones most likely to carry on with their usual activities putting others at risk? Are not asymptomatic carriers the worst case scenario?

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