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.
Figure 1. Chart from Coronavirus risk for Asians, Africans, Caucasians revealed.
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?
And So It Begins
I picked up some parts from a major plumbing retailer yesterday and asked if they were running short of anything.
“Oh ya, some of the distributors sent a memo advising that some parts are out of stock due because they have not arrived from China”
First drug shortage reported https://www.cnbc.com/2020/02/28/fda-reports-first-coronavirus-related-drug-shortage.html
There is still time (a couple of weeks?) to atone for your sins and beg me for forgiveness.
Masks are in short supply many places.
I had the battery on my i-Phone replaced, because I figured the supply would get worse before it gets better.
Gail, can the life insurance companies survive if 3% of U.S. population dies within 1 year?
Life insurance and pension insurance are sold by the same companies. If deaths increase, they raise payouts for life insurance policies, but they reduce payouts on pension policies. So within a company, there are likely offsetting impacts.
My background is in “Non-Life” Insurance, so I haven’t looked at the details of life insurance companies. I would expect that debt defaults on bonds and loss of value on shares of stock would be bigger issues than mortality changes.
Most pension plans have been underfunded. If some older people die, this would help these pension plans (assuming that there isn’t too much loss of value because of bond defaults and falling stock prices).
I hadn’t thought about life insurance and pension being related. Makes since.
Gail, you are correct. The same companies offer life insurance, which is betting you will live, and annuities, which is betting you will die. And there is enough “spread” that they will win on either end of the bet. (Gee, having two accountants as parents is sometimes useful)
Some anecdotal information. The global company I work for here in the US issued a travel ban on all domestic and international flights effective immediately this morning. Anyone currently traveling was offered the choice to cut their trip short and return. We have over 100,000 employees worldwide. I wonder what the effects will be if many big companies start doing this?
If companies cut off all flights for more than a week or two, it will gradually work in the direction of making a big mess out of the world economy.
It is possible to handle some things by phone and video meetings, but not everything. I expect that there will be a gradual loss of control of the various parts of the company. Each part will operate more and more independently, as time goes on. This will especially be the case, if there are electrical outages to go with the loss of flying from place to place. Instead of hearing about companies buying new subsidiaries, we should expect to see a lot of subsidiaries spun off.
Of course, the reduced use of airplanes will adversely affect both airline companies and companies producing oil. Many airline companies will likely go bankrupt. Oil companies will as well. There will likely be a lot of bond defaults as a result, adversely affecting banks and insurance companies.
Congress and senate were working on tele conferencing today so they dont have to leave their bunkers I mean homes and can still do their “job” should CV19 become widespread.
Gail, four hundred years ago there were no telephones, no video conferences, and travel was very slow. The East India Company, one of the most famous and successful in history, adopted exact;y the strategy of decentralisation and delegation of power to local representatives. It was this strategy, in part, that created their success. And globalisation has been a great creator of failure, because it centralises control in small groups remote from the action. Just ask Deutsche Bank.
Robert, you make that sound like an ‘option’
it wasn’t an option. It was all there was, and in a world of less than 1 bn people.
No one could move faster than the speed of hoof or sail. Right outside my house is the road where stagecoaches traversed over 100miles in a single day for the first time (1820s) It was the wonder of the age and the latest thing in modernity.
But Its prime function was to speed up government links between London and Dublin so that control could be centralised on London and prevent Ireland from ‘doing its own thing’. Didnt prevent the later Irish famine of course)
25 years later this had been wiped out by the railways. (More energy input-more speed-more profit)
With india in the 17th/18th c there was no option but to let them ‘get on with it’–it was too far away. The end result was the company creating its own army, and inevitably becoming a petty dictatorship under the nominal rule of the British crown.
It was successful only through looting of resources and oppression of native peoples.
Clive of India ran a protection racket in UK before he set up shop in India and expanded his business
Which was OK as long as profits fed back to london
Too much to go into here, but the India people eventually rebelled against the practices of the company, and Britain had to take overall control of the country—which didn’t really work either due to the racist and avaricious attitudes of the British ‘rulers’
The Britich tried a similar system in the US colonies. We all know how that ended up.
William Dalrymple has written wonderful books on this subject, and the British in Afghanistan.
Life for ordinary Indian peasants in the 18th-century was often an unmitigated Hell: their own rulers were corrupt and violent, and as the Moghul Empire disintegrated they were prey to any passing bandits.
The sack of Delhi by the Iranians set the tone for the whole century: mass slaughter of innocent people.
The earliest British in India were not at all racists, but had become so by the early 19th-century – a very sad story.
Another economic impact of COVID-19 – whacks Wall Streeters
“Coronavirus-driven selling chills IPO market as just one company braves market this week ”
(https://www.marketwatch.com/story/coronavirus-driven-selling-chills-ipo-market-as-just-one-company-braves-market-this-week-2020-02-28?mod=watchlist_latest_news)
All parts of the market look terrible!
COVID-19 – regardless of its actual mortality rate risks (which now approximates the mortality rate of the Spanish flu [2-3%] in the early 1900s – https://en.wikipedia.org/wiki/Biosafety_level) – its economic impacts will continue to echo through international economies for years to come. The degree of direct impacts are just becoming evident. The indirect impacts will parasitize the global economy for a long time – and of course be blamed and attributed to non-viral political enemies and their agendas in the US (and elsewhere) – indefinitely. Some warranted, but mostly not.
FED will work with central banks over the weekend and have something for the markets to chew on….will it be big enough to get markets excited?
The corona virus has been confirmed as spreading to New Zealand now (yesterday, Friday). Straight away there were reports of long queues at supermarkets as people stock up on food and other essentials. Only a matter of time before we start running our of things, given that Just In Time has been standard practice for a while now.
The situation is GRIM…jNo SH#T Sherlock Holmes!
https://finance.yahoo.com/m/d24c2b6b-b520-3d85-8bf4-6c3bd4465207/the-situation-in-china-is.html
If this weekend’s Chinese economic data isn’t ‘worse than 2008,’ the government is ‘lying,’ Miller said
MarketWatch: Which is the single data point that’s most telling to you?
Miller: The numbers in the property sector are remarkable. It confirms this sector is at the bottom of the food chain in China right now, the last priority for Beijing in a long list of priorities. Property is extremely important because it’s the sector in which most Chinese have large portions of their wealth. Chinese people can’t get money out of the country so they’re stuck with only a few opportunities to diversify. The bond market is scary. The stock market is scary. Property has always been the least scary thing and the Chinese government has always known how important it is as a store of household wealth. It shows they’re more afraid of the bankruptcies of small and medium-sized enterprises. At least there may finally be a culling of the herd in terms of (real estate) developers and overleveraged firms allowed to die.
On the positive side, we’re seeing the job growth numbers in slight contraction. It’s remarkable they’re not much worse than that. This is an economy that could be in contraction for a long time, yet firms aren’t firing people. You can’t pay your people, you have no cash flow, no customers, so you’re paying them to stay home right now. (The lack of layoffs) is one reason you’re not seeing big-bang stimulus yet.
Wait, just wait…..2020 the year of the beginning of the END!
https://m.youtube.com/watch?v=ntPHFVWDIqM
They are not paying the workers at 100%, however, at least that is what some early reports said.
Both businesses and the workers end up in a bad situation: The businesses cannot really afford to pay the workers anything, and the workers are not getting enough to keep paying all of their obligations, such as auto and home payments.
That movie is not fading in significance.
Nor is Conrad.
Neither the Lizard King, Jim Morrison….Club 27….R.I.P.
We are Riders on the Storm!
https://m.youtube.com/watch?v=k9o78-f2mIM
This was the last song on the last Doors album with Morrison. Fittingly, it ends with the storm fading slowly to silence.
Property prices have to be falling in China. This would be alarming to people who put their savings in condominiums.
Please, please prices drop in California. A 20% kill off would really help me afford a house in Cali.
Don’t expect electricity in California, however. Just lots of forest fires.
Don’t know if this was posted but..
The US’s newest coronavirus patient had no known exposure to anyone sick and hadn’t gone to China, which suggests containment might be impossible
insider@insider.com (Holly Secon,Dana Varinsky)
Business InsiderFebruary 27, 2020, 11:49 PM EST
A confirmed coronavirus patient in California had no travel history in China and no known exposure to anyone infected.
It could be the first case of “community spread” in the US.
One health official said this should prompt a transition “from trying to contain the disease to more of a mitigation approach.”
A patient in California’s Solano County has gotten the COVID-19 coronavirus without traveling to China or having any known contact with someone sick, the Centers for Disease Control and Prevention confirmed on Wednesday.
“This person appears to be a community-acquired case of coronavirus, which would be the first here in the United States,” Bela Matyas, the health officer of Solano County, which is located between San Francisco and Sacramento, said in a press conference on Thursday. He added, however, that he didn’t think this was the only such case.
“There are probably cases of coronavirus from community acquisition in multiple parts of the country right now,” Matyas said
The floor gates are open…
“The US’s newest coronavirus patient had no known exposure to anyone sick and hadn’t gone to China”
…Except those that are sick don’t show any signs of the illness for 2-3 weeks. So it is almost next to impossible to know whether you have come in contact with someone who has been infected with the Coronavirus. I’ve know doubt that people might have said the same thing when Typhoid Mary was infecting countless of unsuspecting victims.
Just when you thought it couldn’t get any better:
Fido may be a carrier.
https://www.aol.com/article/news/2020/02/28/a-dog-got-put-in-coronavirus-quarantine-after-testing-a-weak-positive-despite-there-being-no-evidence-pets-can-get-infected/23936349/
Who knows? Assuming the dog breathes, even if it does not become a biologic carrier it makes sense the virus could tag along for the ride, how long as anyone’s guess at this point.
“One can visualize some hot shot scientist at a meeting proudly displaying a novel virus recently manufactured, proudly beaming at the accomplishment.” Trouble is that virus just caused a world depression, sorry about that folks.
Seems to me there is an old admonition about not eating an apple from a certain tree, one might even speculate a superior power gave humans some simple rules that were better followed without explanation because they worked. One might wonder how many more of these rules, old myths, old wives’ tales actually are better followed for the common good. It could result in significant cognative dissonance in woke culture. This stuff is hitting us very fast, very difficult to stay on one’s metaphorical feet.
Dennis L.
If rodents are carriers… If rabbits are carriers… Dogs dont just breathe. They live to smell. They sick their noses right in the middle of where rodents and rabbits are and suck in big bursts of air to get the most out of their smell sensation. I sure hope the pups are not susceptible. 🙁
Good point! I am afraid that there could be a lot of carriers the folks are not aware of.
This is a link to the nature article talking about using mice in experiments to create a virus that does not respond to current treatments.
https://www.nature.com/articles/nm.3985
This is the Chinese paper practically admitting to a problem.
https://www.globaltimes.cn/content/1180429.shtml
“Current treatments.” You need to put this in the context – that there are very few effective anti-viral treatments at all. So, the bar to create a virus that doesn’t respond to “current treatments” is extremely low – to almost non-existent.
We also need to understand that most Chinese cities (1,000s) of any size have “wet or live” wild and domestic product markets of varying scales. Wuhan – regarding wet/live/wild markets is the norm, not the exception.
Therein, lies the suspicious coincidence that the virus first appeared at Wuhan – the site of the only known Chinese BSL-4 lab (and the fact that bats are endemic over most if not all of China. The Chinese BSL-4 Lab was designed a few years ago by the French. I have long suspected that China now has more BSL-4 labs that have more bio-weapons capability than the Wuhan facility – which still has some international visitation and purview. (https://en.wikipedia.org/wiki/Biosafety_level). It is the nature of the Chinese mentality to emulate/duplicate successes.
We don’t know all of the places the virus could be hiding.
Dennis, happily I follow an old Egyptian myth: I am a cat person.
No safety for cat people either:
(https://www.sciencedirect.com/topics/veterinary-science-and-veterinary-medicine/feline-coronavirus).
(https://www.wormsandgermsblog.com/2020/02/articles/animals/cats/covid-2-and-potential-animal-hosts/)
Give the broad binding in many mammal species that COVID-19 has been found in and that cats have been long known to carry over corona virus variants – cats will be no less carriers than dogs or most other mammals.
Thanks! A quote from the blog post is
It gives a link to a study as well. https://jvi.asm.org/content/early/2020/01/23/JVI.00127-20
WTI 45.16
Russia is one the major oil producers and dependent on oil revenues.
Yesterday Russia bombed a NATO members (Turkey) HQ in Syria. Officially 33 dead.
Today they sailed war ships through the Bosporus towards Syria.
1/ Russia is the least dependent on oil revenue from the OPEC+ group
2/ Turkish forces currently occupying northern province of Syria (mixed within proxy fighters group sponsored by US/Gulfies) were attacked by the local gov, most likely utilizing intel and armaments sourced from Russia. Turkey was asked politely for years to stop meddling in that area of sovereign and recognized state entity.. so forewarned..
3/ Russia sailed two (more) ~mid sized ships into this theater
+4 yes it could escalate further
..otherwise your news is more or less spot on.. 🙂
“Russia is the least dependent on oil revenue from OPEC” What does that mean? They are the best horse in the Glue factory? and if you are russian propagandist please don’t destroy my computer…..I love russia….
Not propagandist by any stretch just offering antidote to loudspeakers of W-propaganda, which is so pervasive as in the saying by which fish can’t conceptualize living inside water medium or earthlings breading air on the surface subconsciously.
Good Russia is fulfilling its obligations under the UN Charter to come t the aid of a fellow member state that has been aggressed against. Good for them where is the rest of the UN membership?
Russian Turkey war lucky number 13?
https://en.wikipedia.org/wiki/History_of_the_Russo-Turkish_wars
Bringing Turkey into NATO and giving them nukes was really really really stupid.
Russia didnt give turkey s400 to go to war with them. This is just a bit of elbowing over who gets what. USA and even Assad are not calling the shots. It wont get serious.
Fairly jaw-dropping: the Basque government has just rushed 8 students back from Milan. No quarantine precautions, no masks. Choice quotes:
‘They all showed no symptoms, and only one wore a mask so they went straight to their homes.’
”It’s all exaggerated, we’ll just stay at home for a few days and go back when it’s all blown over’.
‘Lots of Asians in Milan are wearing masks, but not many Italians -it’s just a cultural thing.’
‘If you are young and healthy it’s no big deal.’
‘Life was normal, apart from lots of shops being shut,all restaurants and some supermarkets are empty of food.’
Ah, to be young and clueless, trusting implicitly what one is told. ….
I hope not, but Mum dad and granny might be getting a little gift from those kids soon enough.
Xavier, I worry about my parents, too, as they are London-based and in their seventies.
My elderly mother is also in London, with the very oak table under which she sheltered -with the family cat – during the Blitz.
‘Dangerous?! Life’s dangerous!’ is her latest quote on all of this.
I’m stocking her up with lots of long-life food stuffs, (against her will, and she flatly refused to move here) but if her medication runs out…..
Harry & Xabier, if spending extra money at all (besides medicament) put it mostly on fruits, they come in many forms of preservation methods and varieties. The Wuhan bug is not accustomed to such potent natural fruit power from his depraved homeland (or at least designated landing-deployment site) so that’s your advantage to fight him where it hurts.
An endless supply of masks and disinfectant will at most slightly slow down the spread of the coronavirus. They won’t stop it.
Spending all of our resources on masks and disinfectant looks appealing, but ultimately, I don’t think it gets us very far. We cannot get the R0 down low enough, regardless of what we do. All it does is slow down the spread, perhaps by a month or two. If we could miraculously get a solution in that time, it would be great. But if we don’t, it doesn’t buy us much. We just spend our resources on stuff with limited impact and adverse consequences of other types. For example, disinfectant kills good germs as well as bad.
Right again , Gail, this just in…
U.S. health officials say Americans shouldn’t wear face masks to prevent coronavirus — here are 3 other reasons not to wear them
Elisabeth Buchwald
MarketWatchFebruary 28, 2020, 9:02 AM EST
becomes pandemic
The CDC said last month it doesn’t recommend people use face masks, making the announcement on the same day that first case of person-to-person transmission of coronavirus was reported in the U.S. The CDC recommendation on masks stands, a spokesman told MarketWatch Wednesday, even with the first reported case of a COVID-19 infection in an individual in California who had not been to China or been exposed to a person diagnosed with the virus.
“The virus is not spreading in the general community,” Dr. Nancy Messonnier, director of the Center for the National Center for Immunization and Respiratory Diseases, said in a Jan. 30 briefing. “We don’t routinely recommend the use of face masks by the public to prevent respiratory illness. And we certainly are not recommending that at this time for this new virus.”
HHS Secretary Alex Azar said Tuesday, “Our advice remains as it has been that the average American does not need a N95 mask. These are really more for health care provide
N95 masks are tighter-fitting than surgical masks and protect against small particles and large droplets, according to the CDC. Azar said that there are only 30 million N95 masks in the national stockpile, adding that there are “as many as 300 million masks needed in the U.S. for health care worker.
Adalja applauded the CDC’s recommendation on face masks. “Even during H1N1 [flu epidemic], there was no recommendation to wear face masks,” he said. They “end up creating a false sense of security and most people don’t wear them appropriately,” he said.
People who are not in the medical field who wear the masks often come in contact with germs when they lift the mask up to eat or slip their fingers under the mask to blow their nose, he said.
Panic-driven demand for face masks, Adalja said, is particularly worrisome because it could have “a negative supply shock” effect on hospital personnel who need these masks more than the general public.
“The best ways [for the general public] to protect themselves are the basic hygienic measures,” he said. That includes washing your hands regularly and covering sneezes and coughs. But if you are “sick and need to go out you should wear a mask.”
Instead of wearing face masks, the general public should “be vigilant to the symptoms and signs of this novel coronavirus, that is, a fever and cough, and if you have those symptoms, please call your health-care provider,” Messonnier said last month.
absolutely. Available masks should go to health care workers.
“…if you want to start grappling with these [coronavirus] costs now – in real-time – look to any of China’s main airports. They are normally among the busiest in the world: by itself, Beijing Capital International Airport receives about 100 million passengers a year, dispatching them to almost 150 international destinations and just as many domestic ones.
“But now they are places of terrible inactivity. In the month to February 13, the number of departures from Chinese airports fell by 87%, from about 14,250 to 1,900.”
https://www.theneweuropean.co.uk/top-stories/what-affect-coronavirus-has-had-on-the-economy-in-china-1-6535078
“Over the past three weeks, some 30% to 60% of weekly outbound [shipping] capacity has been withdrawn from the Asia-Europe and transpacific trade, as well as from intra-regional routes.”
“…According to the shipping analyst, the inactive container fleet reached a massive 2.04 million TEU on 17 February, 8.8% of the global containership fleet.”
https://afloat.ie/port-news/port-and-shipping-news/item/45524-china-demand-slump-causing-record-void-box-sailings
“Tanker charter rates have torpedoed more than 80 percent as the coronavirus outbreak continues to slam the brakes on large economies, costing the shipping sector hundreds of millions in lost business, an industry official told Reuters news agency.”
https://www.aljazeera.com/ajimpact/disruptive-coronavirus-torpedoes-global-shipping-200226150548601.html
“The slowdown has sent volumes plummeting this month at the Port of Los Angeles, the largest U.S. gateway for seaborne imports from China…
“U.S. shipping demand [and indeed global trade] already was faltering before the coronavirus restrictions began disrupting global supply chains.”
https://www.wsj.com/articles/coronavirus-impact-seen-prolonging-u-s-freight-slump-11582832476
Many problems at once:
Quarantining everyone, or a large share of migrant workers staying in their home province, doesn’t really work. All parts of the supply chain need to be present.
What a mess! Shipping is way off. Business as usual cannot operate the way it has in the past. Stores won’t be able to restock shelves. Fewer long haul trucks will be needed.
Gail, it is a mess. I must confess I am unnerved as I have ever been – we’re experiencing simultaneous and severe supply and demand shocks on top of an already wobbly global economy, awash in unprecedented and dangerous amounts of debt, and there is only so much the central banks can do.
Are you going to go ahead with your flights, do you think? I might be tempted to stock up on food and hunker down instead…
I’m not ashamed to admit that I got a bit wobbly over all of this the other day, but it’s over – it does no good and there are things to do.
‘Steady, hold the line!’ as they said on the Somme. Or was it Waterloo?
If we can somehow muddle through the defaults and the supply-chain disruptions and the psychological impact of the recession and of the disease itself then I can imagine there being a self-reinforcing, relief-fuelled rebound (until of course other limits to growth encroach once more) but those are some pretty big ‘if’s.
But you are right, Xabier – nothing to be gained by succumbing to negative emotions. Action is the antidote to despair!
That has been an idea. But I don’t think that approach works for the economy as a whole. Also, if I get the virus, presumably I get over it and get on with my life. We have to deal with it in that way.
Wow! This big cutback in flights slows down the speed with which the virus spreads. It doesn’t stop it, however. The virus keeps spreading within China and outside, unfortunately. All it takes is a few very small number of individuals with the virus to start the chain going.
“Chinese banks are taking extraordinary measures to avoid recognizing bad loans, seeking to shield themselves and cash-strapped borrowers from the economic fallout of the coronavirus outbreak.
“Some of the measures, which include rolling over loans to companies at risk of missing payment deadlines and relaxing guidelines on how to categorize overdue debt, have the explicit approval of regulators in Beijing.”
https://www.bloombergquint.com/global-economics/china-makes-bad-loans-disappear-as-virus-pummels-banking-system
“Activity in China’s vast manufacturing sector likely shrank at the fastest pace since the global financial crisis in February as the coronavirus suspended large movements of goods and people in most parts of the country.”
https://www.reuters.com/article/us-china-economy-pmi/chinas-february-factory-pmi-seen-at-lowest-since-2009-as-coronavirus-slams-production-reuters-poll-idUSKCN20M0BW
According to the Reuters’ article,
If the system isn’t working, just change the rules. This seems to be a standard approach.
I wonder how many new investments in China will be made by outside investors, however. I wonder how existing loans to outside investors will be paid back. My guess is that net inflows of investments into China will be very negative as long as this crisis goes on.
“The market clamor grew louder Friday for the Federal Reserve to step in with interest rate cuts to stem the damage from the coronavirus outbreak.”
https://www.cnbc.com/2020/02/27/market-pressure-heats-up-on-the-fed-with-at-least-three-cuts-priced-in.html
“Mr Carney [of the Bank of England] added that, given this “fast-developing situation”, the Bank is constantly monitoring UK banks to ensure they remain in good health so there is no risk of COVID-19 triggering a financial crisis.
“He said: “It’s too early to tell what it means for the UK, or its magnitude.””
https://news.sky.com/story/coronavirus-could-mean-economic-growth-downgrade-for-uk-mark-carney-warns-11944874
“Central banks can do little to offset economic shocks that affect the ability of businesses to meet customer demand, Bank of England Deputy Governor Jon Cunliffe said when asked how to respond to the effect of the coronavirus.
““If it’s a pure adverse supply shock, there is not much monetary policy can do,” he said on Thursday.”
https://www.reuters.com/article/britain-boe-cunliffe-coronavirus/central-banks-cannot-offset-coronavirus-supply-shock-boes-cunliffe-idUSS8N28U00O
“Central banks have met their match. They cannot counter the economic havoc caused to global supply chains from the coronavirus.
“Nor can tax cuts or a blast of government spending plug the gap when crumbling confidence and emergency anti-virus measures are blocking the transmission channels.
“We are in an unprecedented global situation more akin to the outbreak of war than any episode in collective economic memory.”
https://www.telegraph.co.uk/business/2020/02/28/central-bankers-have-no-power-against-economic-tornado-covid/
You can’t print goods and services. You can’t print healthy workers.
Too many problems for the UK, all at once.
“Hopes the coronavirus would be contained to China vanished on Friday as infections spread rapidly around the world, countries started stockpiling medical equipment and investors took flight in expectation of a global recession.
“Share prices were on track for the worst week since the global financial crisis in 2008 as virus-related disruptions to international travel and supply chains fueled fears of recession in the United States and the Euro zone.”
https://www.reuters.com/article/us-china-health/world-prepares-for-coronavirus-pandemic-global-recession-forecast-idUSKCN20M069
“Contagion. It’s the word the world’s top health authorities dare not utter. But it’s the medical term that has transitioned to the finance world that now lurks in the thoughts of most senior central bankers and treasury officials across the globe.
“The coronavirus COVID-19, once contained in China’s industrial heartland, has now spread to Europe and the Middle East, spawning a climate of panic that threatens to undermine not just financial markets, but the global economy…
“Even under ordinary circumstances, the outbreak of a major global health pandemic such as this would hit commerce and industry hard and rattle financial markets… But, with so much debt, the impact will be magnified. Just as debt amplified the rises, it will exacerbate the falls.”
https://www.abc.net.au/news/2020-02-28/coronavirus-contagion-spawns-climate-of-panic-on-share-markets/12011156
Debt creates bubbles which pop, when conditions are no longer right.
China’s manufacturing industry has been hit hard by the coronavirus epidemic. Many factories are unable to resume production because of a shortage of workers, disrupted supply chains and sluggish demand, leaving manufacturers facing huge losses in sales as they struggle to ramp up production.
ONLY 30% OF ALL SME’s HAVE RE-OPENED!!!
https://www.scmp.com/video/scmp-originals/3052509/chinese-factories-struggle-resume-operations-fight-against-coronavirus
This is a great video. It says a lot in only 5 minutes. As you say, only 30% of the Small and Medium Enterprises (SME’s) have reopened. These SMEs contribute disproportionately to employment and GDP.
Big businesses have started back, but struggle with lack of raw materials, even if they can find enough workers to partially start up.
I am guessing that some of this was filmed at quite a distance from Wuhan. I see snow on the ground, making me think of Northern China.
I am presuming this is another “Fast Eddy” name.
Broader COVID-19 carrier species (explains some cases with no known infected contacts – increases COVID19 infection spread risks in developed/pet loving nations) and more continuing economic impacts:
– Pet dog in Hong Kong found to have ‘low level’ of coronavirus (https://www.marketwatch.com/story/pet-dog-found-to-have-low-level-of-coronavirus-2020-02-28?mod=newsviewer_click)
– One possible coronavirus side effect — cheaper almonds for U.S. shoppers (https://www.marketwatch.com/story/coronavirus-could-make-your-almond-milk-cheaper-in-the-us-2020-02-27?mod=newsviewer_click)
– Virus Disrupts China’s Shipping, and World Ports Feel the Impact. (https://www.nytimes.com/2020/02/27/business/economy/china-coronavirus-shipping-ports.html)
– Coronavirus: California monitoring 8,400 people for Covid-19. (https://www.ft.com/content/d59c359d-45e3-3801-8b4b-48708ff5fe83)
Thanks for the links! Dogs add to the list of possible carriers.
Cheaper almonds for U. S. shoppers means less revenue for growers. I expect quite a few have debt. This makes life more difficult; perhaps some defaults.
Shipping is already disrupted. Perishable goods are especially at risk.
There are a lot of folks being monitored in California. At one point, there were 200 monitoring kits, to spread among everyone. Presumably, no they are getting enough. FT is behind a paywall for me.
This crisis will surely damage Boeing. Airlines looking to upgrade their fleets to the 737 Max will delay, at least for many months.
The 737Max will never fly again. It should never have flown in the first place. Indeed, the whole idea of computer controlled flight is absurd. A computer has no situational awareness, and if events push it even slightly outside its preprogrammed envelope of stimulus/response, it will inevitably fail.
Yes, indeed, Robert. We need to go back to the basic fundamentals as seen here with Fast Eddie’s Airways from the Jerry Lewis film. The Family Jewels.
Very funny movie and clip…classic
https://m.youtube.com/watch?v=1IW758UciaA
As far as the Max 8, looks as if they got an Edsel on their hands.
The Boeing company is the premier top US exporter manufacturing firm to the world markets behind the military weapons complex.
Just another blow to the United States superpower status.
It sounds a lot like the ideas of computer controlled cars and trucks, “if only” the 5G network is big enough and reliable enough.
Computers do things better than humans
Computers make flight much much much safer.
737 was a crappy physical design they tried to correct physical flaw with software
The 737 max should not fly again but not because of computers and software
Human response time not that good.
one in a million humans 500 mseconds
A computer has written a book and reviewed it in 500 mseconds
I presume you are kidding.
Uh no. Very very very fast reaction time to visual inputs is half a second. 500ms. Half a second before the event is registered. Once its registered how fast a response is initiated depends on training. Im talking about response to unexpected events. If the events are normal response time is much faster across the board say catching a baseball or applying brakes in the car. An average of 250ms. But when say a bear enters your livingroom it takes a while to upload. Response to variations in balance are much much faster which is why you can respond in martial arts so much more effectively with physical touch with your opponent. Here are some examples. Note that all of the individuals have very strong cues that a punch is coming but the punch takes under 500ms with predictable results. In some cases they can start a response because they have already preprogramed it and have cues to initiate it. Sucker punch- unexpected event- not a chance. Compare that to a computer response time of 1-10 ms.
https://www.facebook.com/ActiveSelfProtection/videos/how-much-time-do-you-have-to-react-to-a-punch/603051976469253/
“The 737 max should not fly again but not because of computers and software
Human response time not that good.”
A common saying regarding computers is “garbage in, garbage out”. The problem with the 737 Max was the software and stall sensors and Boeing’s stupid decision not to adequately train the new pilots. New pilots learned about MCAS for 1-2 hrs on an iPad because Boeing told all the commercial airlines that a 737 Max was like a 737.
During the two fatal crashes, MCAS overrode the pilots corrective procedures and pulled the nose down because it thought it was going into a stall when it was not. Every time the pilots pulled up, the MCAS software brought the nose down.
Boeing should be put out of business for this because they did not adequately train commercial pilots and ensured the Airlines that the 737 Max was the same to fly as the 737. The hid this information when dealing and getting safety clearance from the FAA and held that information from the NTSB until pressured.
Now, because of the 2 air disasters, Boeing has decided to allow override features for the MCAS and stall sensors if they produce false states.
tldr; Humans did nothing wrong in those air disasters, it was the computers and software who did it.
Thank you, rodster, that was near enough my analysis; the one I wrote up for my class at the National University of Singapore. There were three separate, independent sensors on those craft, any of which could have told the computer they were not climbing. It was connected to none of them. As I said, no situational awareness.
One of the things I have seen in most software that I use is “cumulative error” problems. The software developer focuses first on immediate function limiting issues. If you examine PC or Mac software issues – you will note that often problems can be solved by rebooting/restarting your commuter – a lot of these problems are “cumulative error” issues in the software that were not solved before the software went to market and remain as legacy bugs.
Unlike a word processor where these issues are just time and frustration issues – when the plane or car is in a critical situation where fractions of a second can mean life or death outcomes – you don’t want to reboot the autopilot or FSD system. Neither aircraft or car control software companies have adequately addressed “cumulative error” issues in their products – nor has the technophilic public accepted the reality of these issues in there expectations of the limitations to performance and safety of these products and or their related investment returns.
We have gotten used to the reliability of oil-based engines. We don’t have to reboot these from time to time. Human pilots don’t need rebooting either.
Thats not the computers fault. The computer was blind. If it wasnt it could have taken action much faster than the pilot. But point taken. If a pilot is blind its pretty easy to tell. A computer or PLC not so much.
When a technology fails we condemn it. Is it appropriate? Is it appropriate to condemn all virologists because of CV19? No IMO. its obvious they have saved many lives and alleviated much suffering. With technology comes power. Responsibility and competence must guide that power. Two examples of failures the max and cv19. In neither is the technology going away. That would be stupid. Power omost always allows greater safety if used with responsibility and competence.
It is however a good question. It would seem we have entered a time when multiple events are occurring that are proving that we as a species do not have the skills to cope with the power we have created for ourselves.
The software wouldnt even have been needed if they hadnt slapped a existing engine on a existing chassis to save $ while competing with a competitor. That decision is what I see as the root cause not any inherent safety issue with using computers in aircraft design.
Again, every system designed by man will fail. Add on top of that the excesses of inept and corrupt management, such as at Boeing allowing an unreliable computerized design to be marketed and flown. Mankind, guided by technology companies fixated on profit motive, has been brainwashed into thinking ever increasing automation and computerization is good, usually marketed in terms of “convenience”. Imagine the convenience of a fridge connected to internet. We really have gone overboard on automation and computerization.
Boeing should pay a steep price for their corrupt practices.
https://www.breitbart.com/africa/2020/02/27/kenyans-protest-china-flights-inviting-coronavirus-bouquet-flowers/
“Kenyans expressed outrage late Wednesday as their government announced it would allow China to resume flights into the country and request that Chinese citizens “self-quarantine” to prevent the spread of the Chinese coronavirus.”
“Amid an already tense situation in which Kenyans are growing increasingly outraged by China’s behavior, the federal government announced it would allow China Southern to fly from Guangzhou to Nairobi four times a week (a Kenyan government statement claimed only one flight a week would arrive). Guangdong province, where Guangzhou is located, has documented 1,347 cases of coronavirus and seven deaths. It also claims to have 890 “recovered” coronavirus patients, though doctors in Wuhan, where the virus originated, have begun re-quarantining “recovered” patients who once again tested positive for the virus.”
The situation is a “damned if you do, damned if you don’t” situation. With debt that Kenya must repay to China, it needs to get the project going again. Getting the project going again requires at least some Chinese workers, coming on planes from China. It sounds like there are huge other problems as well. The money from the project is going mostly to pay Chinese workers, not the Kenyans as hoped.
data:
https://www.breitbart.com/national-security/2020/02/27/report-chinese-city-cheats-on-coronavirus-count-by-reporting-negative-107-cases/
“Observers who are not employed by the Chinese government suggested it was more likely the Hubei city officials were responding to the usual perverse incentives of Communist bureaucracy by adjusting the numbers to make themselves look better:
U.S.-based China affairs commentator Tang Jingyuan said that Chinese officials likely lowered the numbers because it shows to their superiors that they are doing a good job in combating the outbreak.
After people complained, “provincial-level officials are asking city-level officials to take the responsibility for reporting irrational data,” Tang said. “It shows you how riddiculous the official data is.”
how riddiculous the official data is…
really?
Negative 107 isn’t irrational. π would be irrational.
https://sanfrancisco.cbslocal.com/2020/02/27/gov-newsom-coronavirus-testing-kits-shortage/
“SACRAMENTO (CBS SF) — California Gov. Gavin Newsom said Thursday the state is monitoring about 8,400 people for the coronavirus, a day after a Solano County patient was identified as the first coronavirus case in the U.S. from unknown origin.”
ah, CA… number ONE state in another category…
“The 8,400 in California being monitored are returning travelers from China, according to the state health department. Those people have been urged to self-quarantine for 14 days and to limit their interactions with others.”
“urged” to “self”-quarantine…
The monitoring is what a survey mailed to them?
California Coronavirus Survey
Note: completion is MANDATORY under penalty of
Quarantine in a Sanctuary City (or Seppuku if you prefer).
1. Do you have the corona virus? Yes, No, Don’t Know
2. How sick are you? Not Sick, A Little Sick, Very Sick, Dead
3. If you are dead, when did you die? mm/dd/yy
4. How many others have you infected? None, Not Many, Quite a Lot, Hundreds, Don’t Know
5. How did you acquire the virus? By voting Republican, From Donald Trump, Don’t Know
6. Are you willing to donate your body to scientific research? Yes, No
https://www.khon2.com/local-news/worries-over-panic-buying-arise-as-some-supply-shelves-at-stores-empty-out/
“HONOLULU (KHON2) — Supplies were flying off the shelves Wednesday, with some shoppers taking pictures of empty shelves at stores across Oahu. This comes after a message from the Health Department to stock up on necessities. There aren’t any coronavirus (COVID-19) cases here in Hawaii, but health officials want people to have food, supplies and medicine just in case.”
no known cases… yet…
If there are cases anywhere, there are cases in Hawaii. There are so many planes coming in from Southeast Asia, some of the must have tourists with COVID-19.
or airline staff with COVID-19:
https://www.businessinsider.com/coronavirus-koreanair-attendant-reportedly-served-tel-aviv-los-angeles-2020-2
“Korean Air flight attendant with coronavirus reportedly serviced 400-seat aircraft that flew between South Korea and US twice…”
where no one is safe:
https://www.breitbart.com/national-security/2020/02/27/iranian-vice-president-tests-positive-for-coronavirus/
“According to Iranian state media, the rapidly-spreading coronavirus epidemic claimed Vice President for Women and Family Affairs Masoumeh Ebtekar as a new patient on Thursday, the first member of President Hassan Rouhani’s cabinet to test positive for the disease.
Al-Arabiya News reported on Thursday that several other high-ranking Iranian officials have taken ill…”
AND:
“Ebtekar attended a cabinet meeting on Wednesday at which Rouhani was also present. Evidently no one at the meeting was wearing a protective mask.”
This virus is going to go around, with or without masks.
Well, there are(were) ways how to escape and deflect it, not that expensive anyway (for W standards), but that ship already sailed with protective gear sold out, and “silent” super spreaders likely all around the world mixed within pop by now etc.
Nevertheless isn’t it rather more advantageous to position yourself as the survivor of the pandemic, i.e. to weather out the symptoms or even the pneumonia and other illnesses, in other words build up the immunity and resistance to it.
But perhaps even this is on shaky grounds, as the stories of re-infection of the same patients and mutations are circling around now, semi confirmed..
Yes, re-infection, or simply resurgence of the original infection, now seems to be significant factor. Wildly diverging estimates of how long this thing survives on surfaces, too.
‘If you flee Death in Baghdad, he’ll be waiting for you in Damascus’.
Not just deaths that matter though: the UK government is forecasting 20-30% of the workforce off sick at any one time.
The forecast of 20% to 30% of the workforce off sick at any one time is interesting.
If ultimately 70% catch the coronoavirus, the time over which the 20% to 30% off sick gets extended out for several months, with it gradually tailing off to 10% out, and then 5% out. A few workers will die and never come back.
I expect that there are now a lot of situations where there is resurgence in the same patient later, because the person’s immune system did not completely kill the virus.
We know that the virus is already mutating. In fact, there are different mutation strings, in different parts of the world. Whether immunity to one version will give immunity to another version is unknown. A reasonable guess is, “No.” Cold viruses keep mutating, and we keep getting new versions. Flu viruses keep mutating, and vaccine makers keep trying to keep up. This virus is likely similar. If we get a vaccine that works, it likely doesn’t work for long.
Most people will mishandle their masks anyway, or drop their guard, fail to stop an habitual reflex action, fumble, etc.
Their main use for the public is perhaps psychological reassurance.
I suspect my Venetian carnival mask will be just as much use as a medical one……
https://www.worldometers.info/coronavirus/
Maybe Martenson has a legitimate request when he says the virus needs to be sequenced in countries like Italy, Iran and SK where the virus is spreading very fast. In South Korea today alone the number of new cases is 761 taking that country over 2000 cases.
https://www.worldometers.info/coronavirus/
Sweden “We don’t see no stinkin’ danger”… that Sweden… up from 2 to 7 cases in one day…
Spain about double in one day 13 up to 25…
France more than doubles 18 to 38…
Germany 27 now up to 49 cases…
Singapore… ah, Singapore, they tried so hard… stopped at 89? no, case number 90 then 91 then 92+93 yesterday and today at 96…
Japan plus 42 now at 214 cases…
Iran and Italy and South Korea are exploding in cases… as the above countries will be in March…
the Doom has taken flight…
Sweden who gave 40 millions to OTHER countries so they could prepare for the virus.
I am still not so sure that this will not fade away…and the stock market will pick up were it left off. Futures are already up 120 right now…a couple of good days and we are back….I don’t think this is it.
the reported cases in Europe spiked today…
tomorrow, there will be more…
with a lead time of 5 to 8(?) hours over the USA, the markets here will have all of Friday’s worst European news to “digest”…
the markets will continue to have “indigestion”…
OPEC+ and gov&CBs made surprisingly little effort so far, perhaps they have decided to set up the serious defense line at lower price level say ~$37-44 aka learned they lessons about catching a falling knife..
Was it Dan or someone posted few pages back graph for ~$28 drop scenario.
At that price, even Russia would have to resort to slightly subsidize their oil industry and Gulfies would be definitely on the ropes, but again they enjoy more unrestricted access to the global print levers and spigots via the fin cartels.. so who knows how this unfolds..
Dow -1192.75
That’s Minus One Thousand One Hundred Ninety Two, point Seven Five. Really dropped hard in those last few minutes another ~200 points. It keeps making minor adjustments, but that’s about it folks. Really crashing hard now!
I see WTI oil price at $46.27. This is a problem as well. I wonder if it will be as high as $50 again.
Copper is currently sitting on $2.553 per pound. On December 1st, before the corona virus outbreak started (according to generally reported timeline), copper was $2.797 per pound. That is a fall of just under nine percent. Which doesn’t seem like much when China has been almost shut down.
Leveraged oil shorts up ~240% since early Jan 2020 and likely way more “return” with pro tools beyond calls/put options.. Yes, gambling for the win.
Now, what do you do with the prize money when stores are empty and factories will be in spiking on/off mode (i.e. producing crap quality), lolz.
“I wonder if it will be as high as $50 again.”
That’s a good question. I just saw a report that can be linked because they want membership to show it, but so far this week the US stock market has lost a trillion dollars in valuation and todays Dow drop was the biggest in history.
I’m wondering what will happen as we move forward here, because at some point the markets will panic beyond these initial drops. We’ll likely have a day in which the Dow loses 2500 or hit loss limits. The loss so far this week from US stock markets is 1.7T, wow!
I changed that from 1T loss on markets to 1.7T from another more updated report.
How much of that $1.7 trillion came out of retirement funds? I worked with a lady that had retired but her fund got crashed in 2009 and she had to come back to work.
I don’t know if it’s ok to link this most recent video by Martenson, but at 2:20 He’s suggesting they sequence the virus that is spreading in South Korea and Italy, because he’s thinking that the numbers there are rising so fast it may have mutated.
It’s fine to link to whatever videos you like. I find Chris Martenson’s videos very interesting. I might come to somewhat different conclusions, but he has done a lot of research to come up with what he is showing.
Chris has made a few mistakes (snakes as source), but all in all good presentation.
I don’t really agree with Chris that there is a point in trying to make great efforts to keep the virus from spreading. They won’t work, and they won’t even buy much time.
Take a flight from Wuhan ==> Thailand ==> North America. Super spreaders are likely everywhere. I suspect numbers of symptomatic infected will soon explode here in the US if Mr. Martenson’s email is correct.
It is not entirely irrational to stay away from Chinatowns and Chinese restaurants. People traveling from abroad often like to eat food that is closer to what they are used to from home.
“Super spreaders are likely everywhere.”
https://www.statnews.com/2020/02/27/a-single-coronavirus-case-exposes-a-bigger-problem-the-scope-of-undetected-u-s-spread-is-unknown/
“The discovery that a California woman was likely infected with the novel coronavirus by a previously unrecognized case in her community is proof of an enormous problem the country is facing at the moment, according to public health experts. It’s clear that the virus is spreading undetected in the United States — but how broadly it’s spreading is an utter mystery.”
the next chapter of this mystery will be known very soon…
when we see data on the bursts of cases in random areas around the USA…
I am not sure people will give us much information on this. Only if it becomes way too obvious.
Dow -1192.75
Vix spikes to 39… one of the highest spikes ever…
US 10 year today at 1.25 all-time low…
US 30 year today at 1.78 all-time low…
German 10 year Bund MINUS 0.54%…
it paints a vivid picture:
things fall apart…
No Kidding!
Meh. really a correction is healthy at this point. I was more worried when it just kept going up.
«IN PUBLIC HEALTH, honesty is worth a lot more than hope. It has become clear in the past week that the new viral disease,covid-19, which struck China at the start of December will spread around the world. Many governments have been signalling that they will stop the disease. Instead, they need to start preparing people for the onslaught.»
https://www.economist.com/leaders/2020/02/27/the-virus-is-coming?cid1=cust/ednew/n/bl/n/2020/02/27n/owned/n/n/nwl/n/n/E/414175/n
This is an article from Med Page Today on a similar subject.
Could U.S. ICUs Handle 45,000-Bed Coronavirus Load?
— Here’s what a pandemic could look like
https://www.medpagetoday.com/hospitalbasedmedicine/generalhospitalpractice/84845
Agreed, we seem to have a consensus on who is going to make it, you have a hypothesis that based upon past deaths from plague, etc. many spaces were opened for the young. The Renaissance was from the 14th to the 17th century, the plague was in the first half of the 14th century. We celebrate the Renaissance, we celebrate Leonardo da Vinci who was from the very end of the 14th century to the beginning of the 15th, why should it be different this time? It could be a wonderful time to be alive, the trick is living through it, but Leonardo did have parents and grandparents, so it has been done.
Dennis L.
Depends who you ask (definitions), but the end of Renaissance was punctuated by 30yrs war, coinciding with solar minimum, e.g. Swedish army was looting as south as in Bavaria (near Alps) – their king was killed on the battlefield, even before that war most of civ hubs were stripped of quality wood (needed for charcoal, construction etc) even in the wilder outposts..
And the beginning of the period was marked by waves of serious uprisings, e.g. the 1381 revolt in UK, which was mm away from killing the king and his entourage.. Few decades later first ~protestant civ wars and series of interventions broke out in Bohemia etc.. Also you had the ongoing Turkish invasion via Balkans into Europe etc.
World,
You are right and my conclusion is it has always been hard. Being a king is a risky business, good ones lead, some are indeed killed on the field of battle, being a President has been a risky business even in a “civilized” state such as the US. Running for that office has been risky, being a righteous leader of a righteous cause, civil rights, has been a risky business, we have a holiday here celebrating that man’s courage and we find it better for all to ignore his weaknesses.
Finding a group is a challenge, somehow we have to grab the best we can get in this one trip through life, it is quite a challenge and at times we run up against our personal limits which is frustrating and can be down right depressing to understand at a most basic level, we do not have “the right stuff” for some of the things we would like to do or be.
Looking at your last sentence regarding Turkey which is currently shooting at Russian planes. I wonder how long that is going to work? One man with a small missile shooting at a war plane with friends does not seem like a good idea from here.
Dennis L.
Questions:
China over the past years has resorted to building cities with no people, essentially make work projects. Why now assume those workers cannot enter the “productive” production? Instant solution to worker shortage.
Assuming everyone is going to die, there is no point an any of this, that is very unlikely. The world is going to go on and the much discussed per capita of everything will go up. Is that a self correcting feature of our world?
Ecology is not empathetic, ecology is more than a few CO2 molecules, all the concern over CO2 should now be quieting, Greta can return to class. Geia has had enough of all this, has burped. The good news is we are part of this system.
This issue has been discussed endlessly, we have extremists hoping for the elimination of all humans, etc. We on this site have spoken of doom and some have calculated down to the last barrel when cheap oil ends, etc. What no one looked at was the denominator in other than apocalyptic ways. Well, Geia may be getting the job done.
The world works, it works very well. We have built a set of assumptions in banking of the relative value of everything, including the microsecond time value of money. Assumptions are being tested, some are right, some are wrong. Get it right and all is well, get it wrong and it could be a challenge. Again, we are part of the system, we are not something to be discarded lightly, mom is metaphorically rearranging the living room furniture. Geia makes the apriori, it is our job to discover the right ones not those which are convenient.
Dennis L.
Demand for goods link automobiles and smart phones was already falling in China, before the new coronavirus. Recycling was a major industry that had to be discontinued, because of the price of oil fell too low. Many coal mines have been closed because of low profitability. Use of concrete in new buildings and building of roads seems to have fallen.
I expect that workers were struggling to find jobs that paid well enough (relative to the high cost of city living) before the coronavirus hit. When an excuse to stay back with their families came, it sounded like a good idea to quite a few would-be workers.
Please forgive me if in some way this seems argumentative, it is an attempt given what you have been saying to look at scenarios.
Agreed that demand was falling, agreed it is secondary to decreased per capita energy, agreed we cannot keep dumping garbage in to the land, see and air. A thesis you hold is going backward is not an option, okay, I accept that. The old is disappearing before our eyes and socially there is great disruption. Conventional economics be it capitalism or marxism appears to be a dead end, or maybe better no longer useful as a rough planning tool.
I deeply suspect you are correct in assuming a higher order, a politically
correct term Geia. Knowledgewise we are a long way from where we were even twenty years ago, or perhaps we are long way in knowing how to apply given basic knowledge. We had to get this far to move on, now perhaps all that per captia is not necessary, if so Geia may be looking to put an end to the pollution, the visuals of CO2 reduction in China could not be fudged. Greta told Davos they had been warned to stop their ways, shut down that which was killing earth, it hand not been done and was not done. Could in years hence she be seen as a prophet? Take yourself back to biblical days, how were those who looked forward seen? There are turning points in history, mostly only seen retrospectively.
The earth needed a great many bacteria, algea, dinosaurs(not true, but a very good optic) to prepare the earth for the accomplishments of mankind which are wondrous, I don’t think living in a damp, cold cave for 37 expected years was all that great. Local pollution from cooking fires was not good for one’s lungs. When Geia was done with that aspect of creation, it all disappeared except in residuals and fossils – fuel really doesn’t come from fossils don’t you know. Jurassic Park sure would be cool though.
My thesis is in China the workers will return, they left home because it was hopeless and I posit, men want a mate, mates are choosy, they want an provider, a protector, men go out to do that because it is a biological imperative, the higher your position, the better the mate, the better the chances of the offspring to go forward, be fruitful and multiply. Women go where they can meet a mate.
This prior paragraph is politically sensitive, but it is consistent with a comment you made regarding retirement of women, move in with a child as we men die first, working to get a mate and so it goes, rinse and repeat. No children? Not going there.
We are biology, without biology plate tectonics can stir the pot, but biology makes it vital, interesting. Dystopia has never been lasting, contrary to John Michael Greer, we do move on, we do move forward and by huge leaps and bounds, unfortunately some of those leaps take longer than one life time. The best is yet to come, we are passengers on the train, we did not lay the track.
Dennis L.
Bats rats and cats
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3323317/
https://www.wormsandgermsblog.com/2020/02/articles/animals/cats/covid-2-and-potential-animal-hosts/
You’ve made great points here Harry. Although alarm bells are beginning to sound, leading indicators have pointing in this direction for a while now. The crisis with the virus has just brought this about much sooner. Here in Canada our government has overspent, and we have accumulated debt during good times, I can only imagine what the bad times hold.
Exactly. As I said elsewhere, any “bump in the road” will now upset the economy. Central banks are out of tools to fix the problem as well.
You’re right again Gail. This time the central banks do not have the options they did in 2008. Nerve wracking to consider what the possibilities are.
How about giving 10000 dollars to every citizen? Untill we have huge net energy, there won’t be collapse. And we have huge net energy – just look at millions of cars on the roads – they wouldn’t be moving without net energy.
Harry was posting hints for imminent recession since ~Q2/3 2019 already.
And obviously prepared for us his great digest of news even before that.
Sounds to me that Harry is right. Does he also blog? Would like to read his work. Thanks for sharing.
Bless you for the kind feedback. It’s been a pleasure and privilege to follow the various threads of Gail’s analyses in the news.
I do have a website but it is more of a news feed than a blog. I conjure up only the very occasional opinion. For reasons too eccentric to go into here I like to keep it somewhat discrete from my presence on OFW but if you send me an email at collapseharry@gmail.com then I’ll gladly send you the link, and likewise to any other commenters who are interested.
Thank you Harry. I will email you.
I feel the Earth move under my feet
Yahoo FinanceFebruary 27, 2020, 7:08 AM EST
No asset class appears to be safe amid the current global market rout. And while it goes without saying that people are losing money, the phenomenon may underscore something far more ominous.
“For the last few weeks, while we’ve had this volatility, you’ve had stocks zig while bonds zag. So every time stocks went up, bonds tailed off and vice-versa,” Academy Securities’ Peter Tchir said on Yahoo Finance’s The Final Round. “All of a sudden, that behavior changed a little bit into the close yesterday. And making it even more dangerous to me, you saw oil fall off into the close. Commodities were selling off. Even Bitcoin was selling off into the close.”
Typically when uncertainty spikes in financial markets, traders and investors will rotate out of risky assets like stocks and into ‘safe haven’ assets like bonds or perhaps gold. When this happens, risky asset prices go down and safer asset prices go up.
But when market participants are panicking, they begin to cash out of everything. And that can lead to even more panic.
In a note to his clients titled “Did Someone Hit the ‘Sell Everything’ Button?,” Tchir wrote that “While increases in volatility are concerning for market participants, changes in correlations, while more esoteric are far more dangerous. Changes in correlation can affect portfolio level volatility far more dramatically than a simple increase in volatility across asset classes (sounds wonky, but this is important).“
The U.S. services sector is at risk
While panic selling is often characterized by the indiscriminate dumping of assets with little regard to fundamentals (like the supply and demand for goods and services), Tchir notes that there may be something real to justify what’s happening in world markets as the spread of the coronavirus (COVID-19) affects consumer behavior.
“I’m really focused on the tourism angle,” Tchir said to Yahoo Finance. “China has become a huge consumer of tourism. The Chinese spend more money outside of China than any other country spends on foreign travel. I think that’s part of the reason we had very weak service data last week. And that service data, to me, has been really important.”
https://m.youtube.com/watch?v=stdi-1tIUhM
This iS the BIG ONE
Covid19 does infect mice but doesnt kill them. asymptomatic. No mouse kissing!
https://globalbiodefense.com/headlines/scientists-test-drugs-against-virus-samples-from-first-u-s-covid-19-patient/
Implications for shipping products?
“The spread of the coronavirus around the world could trigger economic damage on the scale of the 2008 financial crisis, analysts have warned, amid growing concerns over the fallout from the deadly disease.
“Financial markets around the world continued to tumble on Thursday as countries stepped up their efforts to contain the virus by banning travel, closing schools and postponing major sporting events and business conferences…
“Major banks could come under severe pressure from companies struggling to repay loans at a time when debt levels have surged beyond the previous peak seen before the financial crisis, hitting a record level of $188tn.
“The International Monetary Fund has repeatedly sounded the alarm over surging global debt levels and the fragility of the financial system, particularly in China, where it warned that as much as 40% of corporate debt would be impossible to refinance in a downturn just half as bad as the 2008 crash.
“Recent central bank stress tests in China indicated that as many as 17 out of 30 big banks in the country would fail if economic growth slowed to 4.15%…”
https://www.theguardian.com/business/2020/feb/27/coronavirus-could-trigger-damage-on-scale-of-2008-financial-crisis-covid-19
Real 4.15 percent, or official 4.15 percent?
Perhaps China should be planning for all of its banks to fail.
Government tax collections will also fall far short of what is needed. Bonds will not be repaid as scheduled, either.
A guess by an amateur. Not all work is productive and a guess is work which is productive results in what I think is called the economic multiplier which I suspect is secondary to what is produced being handed down several times in a chain. E.g. doesn’t the GDP increase each time a car is sold, for example new sale, used first sale, used second, etc. until scrap sale and then new metal sale from scrap, rinse and repeat until the steel is scattered to the landfills of the world?
Perhaps services have very low multipliers, they and banking are skimmers, and actual conversion of embedded energy changes very little. It seems to me that conversion of raw materials and sunlight is the basics of economics. A hunter gather society has little need of a banker.
A job with a low multiplier might even be seen as requiring the children of said worker to assume loans for their educations, or institutions of higher learning to require ever increasing fees. A student in what are called primary industries will be part of a process with economic multipliers, at the other extreme a student in the tertiary industries such as wokes, SJW will l have a very low, maybe even negative multiplier. Some will pay their loans, some will find it impossible.
Bonds will be repaid, but not all bonds. In a similar line of thinking might the ratio of GDP high multiple economic conversions to low multiple conversions indicate which bonds will be repaid? A guess is this will not be a static ratio, but maybe it correlates with business cycles.
Dennis L.
Dennis, you might want to check out an intriguing essay by William Morris (1834 to 1896) called “Useful Work versus Useless Toil” You can find it here, and don’t be alarmed by its location: https://www.marxists.org/archive/morris/works/1884/useful.htm
The paws patrol song comes to mind
Nice 8 lane highway!
When I visited China I found they had built some excellent highways. They had also taken care not to demolish historic old city quarters to make room for them. An attitude I greatly respected.
The have lots of very nice roads. My impression was that the majority were toll roads. Some of the led to unoccupied cities. They were pretty empty.
The nature article that had the article about the wuhan lab sars creation. It used mice and reported how the virus resulted in damage in mice. If rodents can be infected can they and their feces be another disease vector? Thats going to take a lot of test kits and some really small masks.
It’s crept up from the 2.1% mortality rate that the Chinese stuck to so rigidly with their data when the outbreak was almost solely within China:
“As of Thursday morning in Shanghai, there were 82,183 cases reported globally and 2,800 deaths, putting the Covid-19 mortality rate of around 3.4%, based on data from Johns Hopkins University.”
https://www.forbes.com/sites/kenrapoza/2020/02/27/top-10-coronavirus-infected-nations-and-their-mortality-rates/?fbclid=IwAR2n1x95eV79APbuc2MsvdxU4Vy1jhOFi7o3xlgN5cKJTYhjhHtSDsq_w3g#448fccfd72a3
Eventually, there will be better data coming out, I hope. A person really needs to be testing broadly, to find out who is not even in the case level. They also need to be following cases to their conclusion. It would be nice to know more about treatments and about age/sex/ health condition.
Johns Hopkins University
Great website by the University if you want to keep informed.
But, your illusions will be put to rest– so I don’t recommend it to everyone here.
I am pretty sure Johns Hopkins was involved in the big study that I received notice of, through my e-mail, back a couple of weeks ago. It ranked 195 countries on preparedness, and China ended up in the middle category (high – medium – low). There were a lot of fairly wealthy countries that were in that middle category as well.
It did conclude, “No country is fully prepared for epidemics or pandemics, and every country has important gaps to address.” The US is ranked at or near the top.
I wasn’t impressed by the study. It seemed to me it was mostly addressing much smaller problems than the one we are encountering now. One thing it advocated was helping less wealthy neighboring countries with their epidemics, so that they won’t spread to your country. It was clear that the massive study was done, long before anyone had heard of the coronavirus outbreak.
This is a link to questions answered by Johns Hopkins expert regarding coronavirus.
https://hub.jhu.edu/2020/02/20/coronavirus-carey-799-em0-art0-qa-health/
This is a sample Q/A
Dr Campbell says that the physicians he is in touch with in Iran (who seem to be fighting the mullahs and their own government as much as the epidemic) are telling him about 4-5% (if I recall correctly).
Of course, they are pretty much unable to treat people adequately; just as global and supposedly more advanced and betterr-prepared systems will likely fail under the weight of numbers of serious cases in a very short time-frame – April to August?
I think we might reasonably assume something of 5-10% mortality rate in an over- stressed system, with lots of medics falling ill, too.
Seems there is some discontent in the UK’s NHS at bland government assertions of being ‘very well prepared’.
I used google to check for flights, in and out of China. I could find them from pretty much everywhere, including Los Angeles. In the US, there are requirements that non-US citizens won’t be allowed in on these flights. US citizens need to undergo health screening. Vancouver has flights to China. So does South Africa.
“Airlines are turning to some of the world’s hardest-hitting disinfectants, capable of stopping everything from sexually transmitted diseases to the MRSA superbug, in the fight against the coronavirus.”
https://time.com/5791414/airlines-disinfectant-coronavirus/
“As coronavirus continues its spread outside of China, the global airline industry is recalibrating its response to a threat that could be its worst since the financial crisis a decade ago.”
https://www.wsj.com/articles/germanys-lufthansa-makes-cuts-as-it-braces-for-coronavirus-impact-11582712819
I wonder what will happen to our intestinal biomes. Everything we try with good intentions seems to have unintended consequences to go with it.
Right – that’s some potent sounding disinfectant!
Unfortunately, it kills all the passengers, too…….. A cousin calls planes ‘death tubes’ as it is.
Hi everyone, howdy? (No, I haven’t died from the coronavirus, just in case some of you are wondering — or hoping for that, Heaven forbid…)
Hey, guess what, I’ve just read that the wonderful CCP has asked everyone to get back to work! Must be because the coronavirus threat either has been overblown or has just been eliminated! Cheer up, everyone, the global economy’s not about to collapse just yet! 😀
(Yes, this is meant to be sarcasm.)
https://www.pajiba.com/assets_c/2019/10/invisible_man_fist_bump-thumb-700×502-217260.png
Remember to wear your face mask, and beware the revolution.
“You can enter the factory without a bra, but you must wear a face mask.”
“The continued threat of coronavirus to consumer spending, supply chains, and trade is bringing the world “to the brink of a global recession” in 2020, the CEO of financial services firm deVere Group said Wednesday.
“”Investors have largely been caught off-guard by the serious and far-reaching economic consequence of the coronavirus,” Green said. “Clearly, this will hit global supply chains, economies across the world and ultimately government coffers too.””
https://markets.businessinsider.com/news/stocks/coronavirus-risk-outlook-global-recession-expert-warns-stock-market-chaos-2020-2-1028942305
“The longest economic expansion in American history has survived an unprecedented trade war, a catastrophic tsunami in Japan and a severe crash in oil prices. The fast-moving coronavirus poses yet another grave test.
“The emerging health crisis threatens to dim the brightest part of the United States, if not the world, economy: American wallets.”
https://edition.cnn.com/2020/02/26/economy/coronavirus-recession-consumer-spending/index.html
Ah yes, the hopeless US media still pushing their view of the Good Life: whoever dies with the biggest IRA wins. I don’t have a US IRA, but I do have the complete poetry of Schiller and the Oxford Book of English Verse.
Actually there is a great dark irony in it as many of the mid-larger money chaser have got their own second, third residences, but they rather stay in the city chasing the very last proverbial dollar instead of i due time rushing for the exits and relocating to hideout far away..
When an economy is stretched as ours is today, any little “bump in the road” can push the economy over.
“The rapid spread of the new coronavirus has prompted the Bank of Japan to ask major banks about their readiness for a worsening of the outbreak, people with knowledge of the matter said.”
https://www.japantimes.co.jp/news/2020/02/27/business/banks-boj-coronavirus/#.XlePI6j7TIU
“Given its close relations with China, the effect of the Coronavirus outbreak on Japan could be significant and will have two channels of transmission: trade and tourism. It now looks possible that Japan’s economy will contract this year.””
https://www.fxstreet.com/news/japan-economy-contraction-is-on-the-cards-bnp-paribas-202002261012
“Prime Minister Shinzo Abe on Thursday asked all elementary, junior high and high schools nationwide to close from Monday until the end of their spring vacations, which typically end in early April.”
https://www.japantimes.co.jp/news/2020/02/27/national/hokkaido-coronavirus-school/#.XleeGqj7TIU
And if Abe asks, the schools will oblige him, and the kids will love it.
We got a message on the municipal broadcast system today. There’s a loudspeaker in my office that has a volume control but it can’t be turned off. It gives me three or four messages in the average day, including a 6:40 wake-up call.Some days listening to it, I feel a bit like Number Six in the Prisoner.
Anyway, today the message from the City Office was that because of the dangers of catching and spreading the coronavirus, people should not go out unless they had a good reason, they should avoid crowds, and that any event that can be cancelled should be. Perhaps the authorities know something we don’t about the real state of the epidemic, or perhaps they are being a trifle over-cautious.
Since what my town does, every town in Japan does, this is going to make a massive dent in the country’s economic performance, a good deal of which is accounted for by meetings and other, events where lots of people gather.
Sorry to hear about that annoying loudspeaker, Tim. But when it calls for a Banzai charge against the virus, perhaps it is time for a final reading of the Hagakure.
What on earth does the 6.40 ‘wake-up’ call say? All sounds worse than the call to the mosque. Surreal.
It’s a bit like permanent subscription to urgent weather alert message in your local county inside the US.. But that’s voluntary, while you can’t switch it off in Japan (and other countries having similar loudspeaker “public safety” network).
i always hated being in crowds, anyway.
So the bank with the employee sick with the coronavirus has disinfected the office and allowed business as usual to continue. The employee is in the hospital. I wonder what the story will be in a few days.
Central banks turn on the spigots:
“China’s central bank said on Thursday that it will ensure ample liquidity through targeted reserve requirement ratio (RRR) cuts for banks at an appropriate time, and will keep monetary policy prudent and flexible to support the economy…
“Many analysts believe more support measures are likely soon as disruptions look set to extend well into the second quarter.”
https://www.reuters.com/article/us-china-health-lending/chinas-central-bank-to-ensure-ample-liquidity-through-targeted-rrr-cuts-idUSKCN20L0YC
“Germany is planning to temporarily suspend its longstanding government debt brake as it attempts to revive its economy.
“The spreading coronavirus and its likely impact on economic growth has added urgency to calls for Europe’s largest economy to loosen the purse strings. The move could open an avenue for limited fiscal stimulus in order to provide relief for indebted regions.”
https://www.telegraph.co.uk/business/2020/02/26/germany-rows-back-longstanding-debt-rules-bid-get-economy-moving/
Good luck to Germany! It seems like it will have a problem with both export demand and raw materials. I can’t imagine a lot of rechargeable batteries coming from China very soon.
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
But it was such a tidy chart! 🙂 Enjoy your charts! 28 a barrel?? That would be nails in the frackers coffins. Sauidi better make sure their credit line is good to go if it goes that low.
Now THAT is a good chart!
I can easily imagine a fall of WTI to $28 per barrel.
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…..
Dow was down over 800, but now back up to minus 525. PPT is perhaps helping support the system. We will see what the end of the day does.
Dow is down almost 1200 points for the day, the worse drop in history. The Black Swan has arrived.
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.
WTI 48
Brent 53
obsessive compulsive reminder 2019 highs:
WTI 66
Brent 75
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
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.
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.
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…..
Xabier, please check out the Tao Te Ching (道德經). You may find you need look no further.
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
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
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…
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
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.
Gozo, 480 per sq km.
Not sure if anyone else posted this yet:
https://www.youtube.com/watch?v=1oKV5MK2bdw
Cheers,
-GBV
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”…
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.
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.
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.
I do appreciate this is one of the few civil places on the internet. Keep up the good work Gail.
++++++++++++
hi Fast Eddie…
will the virus pandemic cause an economic breakdown that will cause the loss of control of spent fuel pools?
or worse?
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.
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
Solution: publish your own blog.
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!
Welcome back Fast Eddy, we’ve missed you. I’ve always enjoyed reading your posts.
welcome back FE
could it be????
the one??????
has returned?
The prodigal son
Had to come home
for the real black swan?
Seriously?
Chill.
https://youtu.be/XMXACjSnEsM
wonderful beyond mere words
Here’s a love song for Norman.
https://youtu.be/t4D3RYJC5KE
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.
https://www.youtube.com/watch?v=wHQ9BW_lq6A
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.
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.