Easily overlooked issues regarding COVID-19

We read a lot in the news about the new Wuhan coronavirus and the illness it causes (COVID-19), but some important points often get left out.

[1] COVID-19 is incredibly contagious.

COVID-19 transmits extremely easily from person to person. Interpersonal contact doesn’t need to be very long; a taxi driver can get the virus from a passenger, for example. The virus may be transmissible even before an infected person develops symptoms. It may also be transmissible for a few days after a person seems to be over the virus; it is possible to get positive virus tests, even after symptoms disappear. Some people may have the disease, but never show symptoms.

[2] The virus likely remains active on inanimate surfaces such as paper, plastic, or metal for many days.

There haven’t been tests on the COVID-19 virus per se, but studies on similar viruses suggest that human pathogens may remain infectious for up to eight days. Some viruses that only infect animals can survive for more than 28 days. China is reported to be destroying paper currency from the hardest hit area, because people do not want to accept money which may have viruses on it. Clearly, surfaces in airplanes, trains and buses may also harbor viruses, long after a passenger with the virus has left, unless they have been thoroughly wiped down with disinfectant.

[3] Given Issues [1] and [2], about the only way to avoid spreading COVID-19 seems to be geographic isolation. 

With all of today’s travel, geographic isolation doesn’t work very well in practice. People need food and medical supplies. They need to keep basic services such as electricity and garbage collection operating. Suppliers of food and other services need to come and leave the area and that tends to spread COVID-19. Also, the longer a geographic area is isolated, the larger the percentage of the people within the area that is likely to get COVID-19. The problem is that the people need to have contact with others in the area for purposes such as buying food, and that tends to spread the disease.

[4] The real story regarding the number of deaths and illnesses seems to be far worse than the story China is telling its own people and the world.

The real story seems to be that the number of deaths is far greater than the number reported–perhaps 10 times as high as being reported. The number of illnesses is also much higher. At one point, facilities doing cremations in the Wuhan area were reported to be doing four to five times the normal number of cremations. Some of the bodies in the Wuhan area now need to be sent to other areas of China because there is not enough local cremation capacity.

China doesn’t dare tell its people how bad the situation really is, for fear of panic. They want to tell a story of being in control and handling the situation well. The news media in the West repeat the stories that the government-controlled publications of China provide, even though they seem to present a much more favorable situation than really seems to be the case.

[5] Our ability to identify who has the new coronavirus is poor.

While there is a test for the coronavirus, it costs hundreds of dollars to administer. Even with this high cost, the results of the tests aren’t very reliable. The test tends to produce many false negatives. The virus may be present somewhere inside the person being tested, but not in the areas touched by swabs of the throat and nose.

[6] Some people get much more severe symptoms from COVID-19 than others.

Most people, perhaps 80% of people, seem to get a fairly light form of the COVID-19 illness. Groups that seem particularly prone to adverse outcomes include the elderly, smokers, those who are obese, and those with high blood pressure, diabetes, or poor immune systems. Males seem to have worse outcomes than females.

Strangely enough, there is speculation that people with East Asian ancestry (Chinese, Japanese, or Vietnamese) may have a higher risk of adverse outcomes than those of European or African ancestry. One of the things that is targeted by the disease is the ACE2 receptor. The 1000 Genome Project studied expected differences in ACE2 receptors among various groups. Based on this analysis, some researchers (in non-peer-reviewed studies, here and here) predict that those of European or African ancestry will tend to get lighter forms of the disease. These findings are contested in another, non-peer-reviewed study.

Bolstering the view that East Asians are more susceptible to viruses that target the ACE2 receptor is the fact that SARS, which also tends to target the ACE2 receptor, tended to stay primarily in China, Hong Kong, Taiwan, and Singapore. While there were cases elsewhere, they tended to have few deaths.

Observational data with respect to COVID-19 is needed to determine whether there truly is a difference in the severity of the illness among different populations.

[7] China has been using geographical quarantine to try to hold down the number of COVID-19 cases. The danger with such a quarantine is that once the economy is down, it is very difficult to come back to the pre-quarantine state.

Data shows that China’s economy is not reopening quickly after the extended New Year holiday finished.

Figure 2. China daily passenger flows, relative to Chinese New Year. Amounts are now down more than 80% and have not increased, even as some businesses are theoretically reopening. Chart by ANZ, copied by WSJ Daily Shot Feb. 17, 2020.

Figure 3. China property transactions, before and after Chinese New Year. Chart by Goldman Sachs. Reprinted by WSJ Daily Shot, Feb. 17, 2020.

All businesses will be adversely affected by a lack of sales if they need to continue to pay overhead expenses. Small and medium-sized businesses will be especially adversely affected. Bloomberg reports that if a shutdown lasts for three months, there is a substantial chance that these businesses will run through their savings and fail. Thus, these businesses may be permanently lost if the economy is down for several months.

Also, restarting after a shut-down is more difficult than it might appear. Take, for example, a mother who wants to go back to work. She will likely need:

  • Public transportation to be operating, so she has a way to get to work;
  • School to be open, so she doesn’t need to worry about her child while she is at work;
  • Masks to be available, so that she and her child can comply with requirements to wear them;
  • Stores providing necessities such as food to be open, or she may be too hungry to work

If anything is missing, the mother is likely not to go back to work. Required masks seem to be a problem right now, but other pieces could be missing as well.

Businesses, too, need a full range of workers to restart their operations. If the inspector doing the final inspection is not available, the business may not really be able to ship finished products, even if most of the workers are back.

[8] A shutdown of as little as three months is likely to be damaging to the world economy.

Multiple things are likely to go wrong:

(a) Commodity prices are likely to fall steeply, because of low demand from China. Oil prices, in particular, are likely to fall steeply, perhaps to $30 to $35 per barrel. Besides cutbacks in oil demand from China, there is the issue of a general reduction in long distance travel, because of fear of traveling with other passengers with COVID-19.

(b) US businesses, such as Apple, will find their supply chains broken. They won’t know when, and if, they can ship products.

(c) Debt defaults are likely to become more common, especially in China. The longer the slowdown/shutdown lasts, the greater the extent to which debt defaults are likely to spread around the world.

(d) The world economy is likely to be pushed into recession, without an easy way to get out again.

[9] The longer the shutdown lasts, the more likely there is to be a major collapse of the Chinese economy. 

In the event of a long-term shutdown, it would seem likely that, at a minimum, a new leader would take over. In fact, there would seem to be a significant chance of major changes within the economy. For example, the provinces of China that are able to restart might attempt to restart, leaving the more damaged areas behind. In such a case, instead of having a single Chinese government to deal with, there might be multiple governmental units to deal with.

Each governmental unit might consist of a few provinces trying to provide services such as they are able, without the benefit of the parts of the economy that are still shut down. Each governmental unit might have its own currency. If this should happen, China will be able to provide far fewer goods and services than it has in the recent past.

[10] Planners everywhere have been guilty of “putting too many eggs in one basket.”

Planners today look for efficiency. For example, placing a large share of the world’s industry in China looks like it is an efficient approach. Unfortunately, we are asking for trouble if the Chinese economy hits a bump in the road. Using just-in-time supply lines looks like a good idea as well, but if a major supplier cannot provide parts for a while, then having inventory on hand would have been a better approach.

If we want systems to be sustainable, they really need a lot of redundancy. Redundant systems are not as efficient, but they are much more likely to be sustainable through difficult times. There is a recent article in Nature that talks about this issue. One of the things it says is,

A system with a single cycle is the most unstable because the deletion of any cycle-node or link breaks the sustaining feedback mechanism.

“A system with a single cycle” is basically similar to “putting all of our eggs in one basket.” “Deletion of any cycle-node or link” is something like China running into coronavirus problems. We probably need a world economy that consists of many nearly separate local economies to be certain of long-term world economy stability. Alternatively, we need a great deal of redundancy built into our systems. For example, we need large inventories to work around the possibility of missing contributions from one country, in the case of a problem such as a major epidemic.

Conclusion

The world economy may become very different, simply because of COVID-19. The new virus doesn’t even need to directly affect the rest of the world very much to create a problem. The United States, Europe, and the rest of the world are very much dependent on the continued operation of China. The world economy has effectively put way too many eggs in one basket, and this basket is now not functioning as expected.

If China is barely producing anything for world markets, the rest of the world will suddenly discover that long supply chains weren’t such a good idea. There will be a big scramble to try to fill in the missing pieces of supply chains, but many goods are likely to be less available. We may discover quickly how much we depend upon China for everything from shoes to automobiles to furniture to electronics. World carbon dioxide emissions are likely to fall dramatically because of China’s problems, but will the accompanying issues be ones that the world economy can tolerate?

The thing that is ironic is that it is possible that the West’s fear of the new coronavirus may be overblown–we really won’t know what the impact will be with respect to people of European or of African descent until we have had a better chance to examine how the virus affects different populations. The next few weeks and months are likely to be quite instructive. For example, how will the Americans and Australians who caught COVID-19 on the cruise ships fare? What will the health outcomes be of non-Asians being brought back from Wuhan to their native countries on special planes?

 

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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2,589 Responses to Easily overlooked issues regarding COVID-19

  1. Chrome Mags says:

    Here’s that Asian woman with a male voice talking about how China has gone back to work, how people are flooding markets for food, many not wearing masks. It would seem the all clear has been announced. XI wants that economic engine charging ahead, but the risk is the virus will spread to more people. Should prove interesting.

    • Covidinamonthorayearoradecade says:

      well, no job/work could equal no food which could equal death…

      so besides Xi perhaps pushing for a return to normal production…

      there is the personal human element where persons will risk death by virus in order to avoid death by starvation…

      this will indeed prove interesting…

      real data from China would be even more interesting…

      • A country really needs its people to be working, or the risk is starvation and loss of things like electricity, heat, and water supply. Besides this, financial markets will seize up.

    • What this woman is saying is very believable. After people are let back out, what they want to do is make up for lost time. They want to go to shops and visit tourist spots. They want to sit outside with friends. There aren’t nearly enough masks to go around. They have a cost as well, and they really don’t protect the person wearing them. So not many are used.

      I can understand why President Xi would want people back to work. Without people back to work, supply chains will cease up. There won’t be enough food for everyone. Debt defaults will be everywhere.

  2. wonderful beyond mere words

    • Tim Groves says:

      Here’s a love song for Norman.

    • peatmoss says:

      Normon I would agree that Trumps comment was insensitive. Why? Haitians are just like all people on the planet. Some good some bad some ok. Frankly it looks pretty chill there compared to some places ive been.

      Trump won the election for one reason. He flipped key labor states. This is because the democratic party sold out the working man by moving manufacturing to China and saying the service economy was a legitimate model several decades ago. The working class in the USA was tired of the sham. Obama promised to renegotiate NAFTA didnt do it. Trump did. Will it change anything in the long run? We will see. Normon do you know how many times my job has been outsourced? Four times. four times working in a career getting great reviews then off to Shenzen. Four times starting from scratch.

      The Union workers rebelled. They were told to vote for Clinton. They voted for Trump.

      Did the Democratic party take this experience and learn from it realizing that they had lost what was the core what they represented. No. They doubled down on there propaganda. Propaganda that ignores the core of what they lost. Crazy conspiracy theories and outright lies about trump from day one. Propaganda that you are a victim of Norman . A victim of and a symptom of the hate it represents. Why on earth is a foreign national so fixated on Trump? Propaganda.

      You see Norman Trump voters are no different than most people. They want what most people want. We want a job. We want our children to have jobs. We really dont want a lot of drama. We accept other people and want to be accepted. The democratic party wasnt providing any of that. The drama of political correctness basically did not accept us even though we accepted them. Norman im on the libertarian side of the conservative alliance.
      What consenting adults do in there own homes is there own business. We dont give a shit.

      We do deserve to be accepted regardless of our race or sexual preference. I recently visited a clinic. I was handed a tablet. It asked me my sexual preference. there were a dozen choices. It asked me my gender identity. There were a dozen choices. If we live in a equal society why is it anyone’s business?

      It is sad there is so much poverty in the world. We are tired Norman. We are tired of trying to change the world. Our troops are tired. We are tired of it Norman. We just want to be left alone. Live our lives. enjoy our families. Not be sent off to war. Not be condemned by propaganda because we happen to have some European ancestry be heterosexual and dont want to change our gender. OUR CHOICE. our choice normon.

      No ones walked my walk Normon. You sure as hell havnt. It was no rose garden. No one promised me one anyway.

      Have you been anywhere Normon? Have you lived any where? Do you speak any Asian languages? I do. I have. For years not days not months. Have you lived anywhere other than your little European propaganda bubble regurgitating hate for trump not understanding that he represents the reluctant populist vote of the working man? I dont care what your country is doing. None of my business. Who gives you the right to infer that trump supporters are racists and facists? Whose the one wearing the brown shirt buddy?

      Why is las Vegas giving Trump 12 to one odds to win. Odds that went way up after the drama of the sham impeachment reminded everyone of the bullshit hypocrisy of the democratic party. Its because nothing has changed except the Labor states that trump won by a margin will be won by a landslide. Not that he truly deserves the populist vote. He doesnt. As long as the democratic party insists that every candidate endorse divisive politically correct drama while directly acting against the interest of the working class and cheating the true choice of their constituency for a sellout like bloomberg trump and future trumps will be in. Trump is a function of the democratic party. The clear choice of the democratic party over bernie or Tulsi by 10x. They cant attack Bernie or Tulsi with their lies and hypocrisy and they are unwilling to compete on their merits of the true choice of their constituencies. They are unwilling to give up their hate. Its all they know. Sad.

      Its also sad that the populist choice is making such uncompassionate statements. But a triad of bouncing Norwegian propaganda gnomes? Seriously? This is how you spend your precious time? Get a life.

  3. peatmoss says:

    Seriously?
    Chill.

  4. Willy Winky says:

    For those who follow Wolf Street, Wolf Richter is refusing to publish this:

    Wolf – just noticing your comment in response to my post re: your not taking kindly to people who disagree with you.

    Hopefully you will post this so this issue can be aired properly.

    I do enjoy reading most of the articles posted on Wolf Street. Clearly many people do as you have a solid audience.

    Recall the username ‘Banker’

    He used to post some of the best commentary on WS – then you censored his stuff and ridiculed him when he asked why.

    He said that he was done with WS because of this and as far as I know he’s not returned.

    If you recall at one point you wrote something (or perhaps posted it in the comments on an article) indicating that a no growth world was feasible.

    I disagreed and I got the banker treatment. I was ridiculed and it was implied that I was clueless.

    I responded with a couple of in depth research papers – one from Yale University – that explained in great detail that a no growth economy would lead to total collapse.

    You refused to publish that comment. The right thing to do would have been to read that study, then if you still believed a no growth economy was feasible, then dispute the findings.

    By not publishing my comments it creates the impression that I have been put in my place. I am an idiot.

    I do not take kindly to that tactic when it comes to making an argument because when I make statements they are thought-through, reasoned, and generally can be backed up with FACTS.

    Fast forward to the other day. I referenced Plunge Protection Teams as a reason why the markets are not crashing on a raft of horrible economic data.

    Your response – that is conspiracy theorist BS and you don’t want it on WS.

    I then responded with a few references as well as evidence that confirm that PPTs exist (e.g. China confirms the PBOC is active in the markets — Japan OWNS a huge chunk of the market).

    Again, you refused to publish this. And I am left looking like the dunce or a tin hat whack job straight out of Fox News.

    To a certain extent I am sure that :

    1. You are losing audience because you antagonize people who dare to make a comment that you do not agree with. Yes, there are plenty of ridiculous comments that demonstrate zero understanding of issues, but in your capacity of moderator, you often attack them.

    2. You are causing some commentators to fear mockery so they do not ask questions that might result in them getting ‘the treatment’. And they certainly don’t deviate off the reserve too far for fear of being ridiculed.

    To this day I recall my grade 8 teacher’s favourite saying when someone asked a ‘dumb question’ or did not understand a concept.

    She used to say ‘if brains were dynamite you wouldn’t be able to blow your own nose’

    I recall sitting there and watching these poor kids get subjected to this throughout the year while the rest of the class laughed uncontrollably.

    Not exactly a great environment to encourage learning and improvement is it?

    My preferred way of dealing with ill-informed or illogical people or those who disagree with me is:

    1. Ask – maybe I am wrong? If so then I need to read up on the issue and decide for myself. Usually I will ask them for references to find out where they are coming from. Most of the time they have nothing to back themselves up except for ‘someone posted that on Facebook’

    2. If I still disagree then I will post facts logic etc… to back up my position. If they refuse to engage in an argument and attempt to give me something other than ‘Facebook said’ and they continue to antagonize me with their ignorance, then…

    3. We go to the nuclear options. I either ignore them – but that often does not work because they will persist in publishing ‘Facebook said’ so then the heavy artillery comes because fools must be driven back into their world of Danielle Steele books and moronic sitcoms. TINA.

    However you are the moderator of this site and you control the gate. So there should be no need to resort to this

    If someone is posting endless rubbish then definitely block them from the site.

    On the other hand, if someone is posting commentary that is clearly thought through, and backed with solid facts, either engage them with same — or ignore them and ‘agree to disagree’

    If you make users look bad (and block their attempts to rebut you) – they will either disappear – or they will go on the attack.

    I have been on the attack mode at various times. It’s in my DNA.

    • I will let you vent your anger here, at least a bit.

      Obviously, Wolf has chosen a particular view of the world to present to his audience. He doesn’t see changing this view as negotiable. I haven’t read enough of Wolf’s comments to know about his attacking commenters. I try to stay away from attacking commenters myself.

      I have tried to be more open to alternative views, but sometimes choose not to run every comment that is submitted. Every person running a website has to set some limits, and not all commenters will agree with those choices. Unmoderated comment sections are generally not worth reading.

    • Covidinamonthorayearoradecade says:

      hi Fast Eddie…

      will the virus pandemic cause an economic breakdown that will cause the loss of control of spent fuel pools?

      or worse?

      • Herbie R Ficklestein says:

        Long live FAST EDDIE…The King of Doom!
        Oh. long live BAU….making Doom a topic of amusement here in “Advanced, Rich, Progressive and Free Civilized Societies”

        We are making progress….just look…😜

        Coronavirus: New York doctors make diagnosis breakthrough
        Louise Hall
        The IndependentFebruary 26, 2020, 8:42 PM EST
        Examining coronavirus patients’ CT scans could lead to a quicker diagnosis of those with suspected symptoms, doctors have discovered
        A team of researchers in Mount Sinai, New York – the first in the US to analyse CT scans of patients – have said they can identify specific patterns in the lungs as markers of the disease.
        The study revealed scan analysis could be a viable option for suspected patients and help determine which patients with inconclusive results should be kept in isolation.
        The doctors, who published their findings in Radiology, received the scans of 94 patients in China who had been admitted to four medical centers in four Chinese provinces between 18 January and 2 February.
        Most of them had traveled to Wuhan or had close contact with an infected patient, the Mount Sinai School of Medicine said.
        Of the 36 patients who received scans in zero to two days within reporting symptoms, more than half showed no evidence of lung disease.
        In a group of 33 patients who received CT scans three to five days after reporting symptoms, the team observed patterns of “ground-glass opacities” – white patches showing up on the scan which became more round in shape and dense.
        In the 25 patients scanned six to 12 days after symptoms, the scans analysis showed fully involved lung disease.
        Patterns seen in these images are similar to patterns seen in related outbreaks such as Sars and Mers.
        “Recognizing imaging patterns based on infection time course is paramount for not only understanding the disease process and natural history of COVID-19 but also for helping to predict patient progression and potential complication development, “ said lead author Adam Bernheim, assistant professor of diagnostic, molecular and interventional radiology at the Icahn School of Medicine at Mount Sinai.
        Doctors said when patients first report symptoms of possible COVID-19, they are nonspecific, often resembling a common cold, so it can be difficult to diagnose and confirmatory tests by the Centers for Disease Control and Prevention can take several days.
        It also cited that the study allows hospitals in the United States and worldwide to confirm or rule out coronavirus based on CT images.
        If lung scans for patients with early symptoms are inconclusive, doctors can consider holding the patient in isolation for a few days until a decisive verdict can be made.

        See..Easy Peezy…should work just fine…and you silly people were worried, geezed

        • All we need is a huge supply of isolation beds, isolation equipment for workers, and additional health workers to do all of this. Also, someone to pay for this huge cost, plus the lost wages of all of the sick people.

      • doomphd says:

        dear Willy (FE),

        so good to see that you (and family, i hope) are doing OK and are posting once again on the internet. we were really worried that you perhaps ran afoul of the Mexican drug cartel on your bucket-list trip to Mexico back in 2018. can’t be too careful as tourists to those places. anyhow, you were sorely missed here.

        so we hope that you will continue to post your intelligent commentary here on OFW where you are loved and respected (well, mostly) for your insight and considerable wit, and not bother with the ges-tapo tactics on display over at WS. Gail is a wonderful, intelligent person and volunteers to run this blog in a very fair, balanced manner. we are all fortunate for her and OFW.

        cheers,
        Doom

    • beidawei says:

      Solution: publish your own blog.

    • Willy Winky says:

      Thanks.

      Wolf has this habit of mocking users if they post a comment he does not like or agree with, then shuts them down completely if they try to engage with him.

      This is his way of ‘winning’.

      It is intellectual cowardice. And only his readers who are not sycophants and dare to stand up to him are aware of this.

      I will be posting this on every article of his that is published on Zero Hedge as well.

      Stand Against Totalitarianism Always!

    • NikoB says:

      welcome back FE

    • peatmoss says:

      could it be????
      the one??????
      has returned?
      The prodigal son
      Had to come home
      for the real black swan?

  5. GBV says:

    Not sure if anyone else posted this yet:

    Cheers,
    -GBV

    • Covidinamonthorayearoradecade says:

      obvious weeks ago to any good Doomer…

      I am planning for tomorrow to buy a lot of household stuff which I have good amounts right now, but… you know…

      I hope I’m not shopping “too late”…

      • doomphd says:

        judging by the shopping here at the local Costco, if you run out of TP, just ask the neighbors for some, as supplies have been widely distributed to household stockpiles.

    • Robert Firth says:

      And yesterday the virus reached southern Sicily. That is the closest point of the mainland, just a short bat flight away. Or the bat can flap onto the daily ferry, for a free ride. If I suddenly go silent, you’ll know why.

      • Not so good. I am planning two air trips in the next two weeks. This is getting more concerning as well.

        At the same time, having COVID-29 and getting it over with has some advantages, especially if a person has a good immune system and is in good health. Presumably, there is a low chance of re-catching the current kind, since there have been reports of antibodies from one person being used to fight off the virus in other people. If a variation comes around later, all bets are off, however.

  6. Covidinamonthorayearoradecade says:

    South Korea is a full blown epidemic:

    “February 27 (GMT):
    334 new cases in South Korea. The number of confirmed cases is expected to jump in the coming days as health authorities have started testing more than 210,000 members of the Shincheonji Church of Jesus in Daegu, attended by the 31st case (a possible “super spreader”) and which accounts for more than half of the country’s 1,595 total cases to date.”

    megachurch with 210,000 members… I imagine that they hug each other a lot on Sundays… or at least used to…

    besides the obvious irony of a church being the main source of the worst epidemic to ever hit there…

    is the obvious massive suffering that will be ongoing there for many months… at least…

    • Covidinamonthorayearoradecade says:

      the above quote from https://www.worldometers.info/coronavirus/

      Singapore holding at 89 cases? no… 90th two days ago, 91st yesterday, 92nd AND 93rd today… well, they did try hard…

      South Korea nearing 2K cases… I would guess that their real data of cases will surpass China’s fake numbers in a month or two…

      Italy 75+ to 155+ to 230+ to 320+ to 470 today… the totals for the last two days are much above the former linear progression…

      Iran 139 cases and 19 deaths… still huge at about 14%…

      fun with numbers:

      Iran 84 million people
      Italy 60 million
      SK 51 million
      Singapore 6 million

      population density per square km:

      Iran 52
      Italy 206
      SK 527
      Singapore 8,358!!!!!!!

      a prominent comparison: China 153 (less than Italy)

      a local comparison: USA 36

      • beidawei says:

        Not a fair comparison. Half of China’s land area consists of sparsely-populated regions like Tibet and Xinjiang. Better to look at it province by province. In the case of Singapore, the only fair comparison would be with another city.

      • Robert Firth says:

        Gozo, 480 per sq km.

  7. Covidinamonthorayearoradecade says:

    WTI 48
    Brent 53

    obsessive compulsive reminder 2019 highs:

    WTI 66
    Brent 75

    • Denial says:

      I wonder if anyone listened to Trump speech he made it seem that everyone is making a big deal about this virus and that it will be gone by April. Could he be right? I am wondering.. people do tend to overreact. Or will we see the numbers take off? One thing I wonder if the the so called “healed” people are really healthy or is the virus dormant waiting for another opportunity to attack

      • Robert Firth says:

        As I see it, the big problem with the US is that they are simply not testing peolpe, and so have no idea of the current situation. And one reason they are not testing is that they have very few test kits, and many of those are suspected of being faulty. The US emphasis on expensive advanced procedures for small minorities is coming back to bite them in a big way. It is also the reason their drug problem is out of control, but at least drugs aren’t infectious.

        • I am not sure that not testing is all that bad. It at least prevents mass hysteria. Slowing the virus down doesn’t really stop it.

          The one reason I can see for slowing the virus down is if there is likely to be some sort of substantial mitigation available in the next month or two. If some treatment (antibodies from patients who have had the illness, HIV drugs, other antivirals) can substantially help people, that would be a huge help. It could perhaps keep people out of hospitals and intensive care. It might get them back to work more quickly.

    • Hide-away says:

      So what happens to oil prices when the coronavirus has spread throughout the middle east and left workplaces unattended for a month or 2, especially oil production facilities??

      Just what the world needs is a sudden supply drop, then add all the oil facilities in other countries closing down, with lag times between each of course, and we have a huge problem.

      The size of the problem also keeps growing thanks to the latest from Japan where a tour guide that was one of the first in Japan to get get the virus, then recovered, has tested positive again after a new sore throat and chest pains..

      https://www.huffpost.com/entry/coronavirus-japan-2nd-positive-test_n_5e575459c5b66622ed769ea8

      We all had theories of how collapse would happen over the years, but this ‘black swan’ is a real possibility the way it is heading.
      If countries try helicopter money, I suspect they will just create massive inflation in a time when businesses, industry, etc are closed down.

      It has been a fun ride talking doom and gloom, until now….

      • It’s not merely about “Fun” at least for large pool of the frequenters here.
        There is simply a faction within human society, “odd-balls” who sense on some level and capacity that several underlying key aspects are “very wrong” with the human society – in long term perspective.

        I guess it all boils down to the core realization human society is a lossy proposition (as opposed to loss-less rejuvenating nature). Basically, the moment you need tools – no matter how primitive – you begin the roller coaster ride of our past existence towards present time, you have to rework and replace these tools as they loss sharpness, brake, get lost etc. That process in aggregate eventually leads to gigantic terra-forming force of today, and it all likely had originated at the dawn of the stone age or perhaps even earlier with other close related hominids..

        Humanoids are strange mutation.

        • Xabier says:

          Well, yes, isn’t there something called ‘Peak Flint’?

          Moreover, tales and legends embodying full appreciation of this process – the perhaps inevitable doom of tool-using tech civilisations, previously local and regional, and now global – have been created over the last two thousand years or so in Central Asia and the Near East.

          See the Book of Enoch (the sciences and tools are a poisoned gift) , the Shahnameh ( carrying capacity can be extended greatly with technology, but must ultimately fail) , etc.

          I haven’t seen an ancient Chinese variant yet, but I’m sure one exists somewhere in the immense literature of that civilisation.

          It is, of course, implicit in the cyclical view of civilisation which every civilisation has arrived at – except ours until now, as we became hypnotised by the possibility of endless Progress in the late 18th century.

          Some of our ancestors certainly weren’t clueless, and the legends and myths were always there to refer to, but we ended up here all the same…..

          • Robert Firth says:

            Xabier, please check out the Tao Te Ching (道德經). You may find you need look no further.

            • Xabier says:

              On further reflection, the Egyptians seem to have seen technology and civilisation as being only good: the gift of Isis and Osiris, and the other gods.

              No doubt a perspective favoured by the ever self-renewing Nile?

              The inhabitants of the city states of Mesopotamia and Central Asia time and time again saw them crash, as resources were exhausted and land became infertile.

            • the Nile kept the Egyptian system going for 3000 years or so—it was effectively a ‘green” economy

              our system has burned itself out in 300 years—effectively a black economy

        • Country Joe says:

          There is Universal Law……… Species Trumps Individuals.
          When the number of individuals of a species creates conditions that causes extinction of other species then that excessive number of individuals is reduced.

    • WTI now 46.16
      Brent now 50.61 according to WSJ futures list

  8. Herbie R Ficklestein says:

    Say goodbye to the Friendly Skys!
    Korean Air flight attendant with coronavirus reportedly serviced 400-seat aircraft that flew between South Korea and US twice — here’s the list of the known routes she flew
    tpallini@businessinsider.com (Thomas Pallini)
    Business InsiderFebruary 26, 2020, 8:05 PM EST
    The Korea Centers for Disease Control and Prevention confirmed the Korean Air flight infected with coronavirus serviced a flight to Israel with 31 reported cases of the virus.
    The South Korean passengers onboard the flight were returned to South Korea, with the flight attendant reportedly servicing additional flights after returning.
    South Korean media is reporting that the flight attendant worked flights between Seoul and Los Angeles, a popular route for the airline.
    The South Korean Center for Disease Control and Prevention has confirmed that the Korean Air flight attendant diagnosed with coronavirus was onboard a flight from Seoul to Tel Aviv where 31 cases of the virus were reported. The flight was operated on February 15 with around 200 passengers onboard, the Times of Israel reported.
    Though Korean Air has not released the flight attendant’s full routing since contracting the virus, it’s believed that the employee worked additional flights to and from Seoul in the days following the flight to Israel, according to South Korean news outlets, including flights between South Korea and the US.
    https://news.yahoo.com/korean-air-flight-attendant-coronavirus-010558635.html

    I can attest that this is just the tip of the iceberg!
    This may just cause a full scale DEPRESSION in the Airline Travel Industry!
    Have a nice flight…oh, mean night….
    It doesn’t take much of a downturn to kill an Airline…

    • After workers on an airline get laid off, I expect most of them will need to find new jobs to support their families. Even if the airline would want to ramp up again, it would need to find trained workers to replace the ones they have lost.

  9. Herbie R Ficklestein says:

    Markets NEVER Sleep…
    U.S. Stocks Plunge, Bonds Surge After CDC Warning: Markets Wrap
    Vildana Hajric and Claire Ballentine
    BloombergFebruary 25, 2020, 4:04 PM EST
    (Bloomberg) — U.S. stocks tumbled to an almost 12-week low and bond yields plunged to records on rising concern the coronavirus will upend global supply chains critical to economic growth.
    The S&P 500’s four-day rout reached 7.6%, with losses accelerating Tuesday after the U.S. Centers for Disease Control and Prevention warned Americans to prepare for a coronavirus outbreak at home. That follows a rapid increase in cases from Italy to Iran and Japan, with a growing list of companies warning that profits will suffer as economies around the world suffer. The S&P, Dow Jones Industrial Average and Nasdaq Composite indexes all set record highs this month.
    The 10-year U.S. Treasury yield fell to a record low of 1.3055% as investors sought shelter from the virus’s impact on the outlook for growth. All 11 sectors in the S&P 500 fell with energy, material and financial shares leading the declines. Volatility spiked, sending the Cboe’s measure of equity gyrations surging past 30 for the first time since 2018.
    “The market is pricing in a significant slowdown in GDP and a 10% impact on earnings,” said Zhiwei Ren, portfolio manager at Penn Mutual Asset Management. “And since no one knows how bad the infection will be, it is hard to make a bet on economy.”
    U.S. central bankers are closely monitoring the spreading coronavirus, but it is “still too soon” to say whether it will result a material change to the outlook, Federal Reserve Vice Chairman Richard Clarida said.
    Elsewhere, European stocks closed in the red, while bonds from the region were mixed. Crude oil slumped again after Monday’s slide of nearly 4%.
    Japanese shares tumbled more than 3% as traders returned after a holiday. Stocks fell in China and Australia and pushed higher in South Korea and Hong Kong. The yen strengthened against the dollar for a third day.

    Me thinks that the CBs may be losing it…..

  10. Yoshua says:

    WTI 47.95

    The technical chart has been damaged.

    The treasury yield suggests that the WTI will fall to USD 28.

    https://pbs.twimg.com/media/ERwQRh_XsAEo-XA?format=jpg&name=large

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