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March 12, 2020 5:24 pm
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A plunge in bitcoin’s price to briefly just under $4,000 and a collapse in eth’s price to under $100, was the latest market sell off in anticipation of reduced economic activity across the world.
Dow has now wiped out all the gains of the past 4 years, although it has risen by some 4.5% today amid considerable volatility.
A global recession is expected, with the only question being how bad it would get as layoffs are announced especially in the flight industry, but hopefully temporary ones.
However governments around the world are taking significant stimulus measures, which might lessen the impact.
Corona, Hysteria or Prudence?
Currently this is at the spreading stage now as containment has failed. Just how much it has spread is unknown because some do not show symptoms at all, especially children.
By Germany’s data the fatality rate seems to be about 0.1% or probably even lower accounting for asymptomatic cases and the fact testing doesn’t really work.
By UK’s data too, where they estimate there are 5,000 to 10,000 infections and currently 10 deaths, it seems to be around 0.1%.
Even there it skews significantly towards the elderly, with this virus presumably taking resources from the immunity system to see what it is, and thus perhaps “allowing” underlying health issues to get worse.
Still even in the elderly most go through it fine, so in Italy where there are 1,000 deaths it is probable 10 million or more already got the infection with this at its peak now there.
UK is going through very cold weather, so this is spreading exponentially with the key here being to manage how many people get it at the same time.
Hence they’re not taking significant measures now presumably because they want some to get it so that it goes in waves and is spread out rather than all in one.
They’re probably resigned to the idea everyone will get it, so they presumably think there’s no point in trying to stop it because you can’t at this stage.
It would have been useful if the British government clarified whether they would take lockdown measures with troops on the street and all the rest as in Italy, or whether they think they can manage with less severe restrictions.
The point for now seems to be to slow the spread, while also allowing it to spread. Presumably again so that it’s a bit in waves rather than all at once.
So at least we have more clarity with this being more serious than the flu because it is new and thus there is an immune response to it, so it is a bit more lethal but generally it is kind of the flu.
And just like everyone gets the flu now and then, presumably everyone will get this too, with the main point being that they don’t all get it at once.
Geography is playing a role in that flattening of the curve too because China for example has gone through this and presumably a good chunk has been immunized with their death numbers probably significantly under-reported, but they could now perhaps spare resources to help Europe, doctors and the like.
Italy should too in a week or two get through this, and thus they could come to the assistance of northern Europe.
Quarantining, Helps Corona or Hampers it?
Whether these travel bans and quarantines are the right strategy presuming everyone will go through this at some point, though not necessarily this winter, is an open question.
That’s because if people from those 10 originally affected areas in Italy could travel to other places, for example, the healthcare system in those other paces would have been in far less strain, and would have taken off some burden from the hospitals in the quarantined areas.
So this quarantining maybe makes it worse because this isn’t a highly deadly virus, but it is highly contagious. Meaning it can’t be contained or quarantined not least because plenty have no symptoms at all.
In addition it may be quarantining makes it spread faster within the quarantined areas as seen by a significant number getting the infection at the same time in quarantined cruise ships while the rate of infection might have been more spread out if they had been allowed to leave.
Thus following China’s example might not be the right approach if this will spread everywhere as it has been spreading for months and is now a pandemic.
Nor is it clear whether those measures did really have any effect because this has now spread everywhere so it didn’t stop it and maybe it hasn’t even slowed it down with the weather seemingly being a better indicator of its trajectory than significantly restrictive measures.
Thus Britain is not closing schools because children are not affected and if those children stay at home more than necessary they will spread it more to their parents and then colleagues and so on because you are more likely to have fluid contact at home.
Meaning what is more important is to slow the spread particularly where the elderly are concerned so as to reduce demand on medical care.
The best way to do that is for everyone to be more hygienic, but generally get on as normal unless they have high fever or a continuous cough. Then take particular care when it comes to the elderly who should be staying at home.
That would then avoid a significant drop in economic activity with it amounting to 10% of the GDP for Italy which is considerable.
The outbreak in Italy however was more concentrated, so putting significant pressure on few specific hospitals.
In UK it is more spread out so there might be less concentrated healthcare demand, and thus perhaps less restrictive measures.
UK, a Potentially Better Approach?
For UK and US the worst is yet to come, but if the now considerably more informed scientists come up with more effective measures and at the right time, rather than measures which might seem common sense but might actually be counterproductive, then hopefully there will be less impact here both on the economy and on health.
The economy affects health. Those doctors and hospitals and so on need to be paid somehow, and though you can print money, that by itself doesn’t create surplus value which can then support more doctors or hospitals.
So it isn’t necessarily a choice between health and the economy as seen by the fact wealthier nations are generally more healthy.
Thus a balance needs to be struck under the understanding this is now a pandemic which needs to be managed but hopefully without politiking and without necessarily just copying authoritarian regimes when we now have our own facts and understanding and thus can better establish how to respond most effectivly.
One such fact being testing is useless at this point, unless needing care in hospital, because you just can’t test everyone and test kits don’t even work as they don’t reveal asymptomatic carriers and might have too many false positives.
Thus sending people who might seem like they have this virus to quarantined facilities might infect people who don’t have the virus. Leading to the opposite of spreading it out and more to everyone getting it at the same time.
So the measures taken in China might have made the situation worse, especially the quarantining of people who they took off their homes and into infected centres.
Likewise the quarantining of the towns in Italy probably couldn’t even be enforced, and thus might have led to more movement of people as we saw with the mini-exodus out of Milan or the big EXODUS out of Wuhan.
Leading potentially to a faster spread, and at the same time, because people got locked into their homes with the elderly, instead of going to work and other activity, reducing such contact and thus the spread to the most vulnerable group.
So whether the worst is over economically depends on how UK plans to tackle this with the peak here expected in 10 to 14 days.
Life is going as normal, but everyone is talking about it with the only measures taken for now being to ask individuals to self quarantine if they have the symptoms.
The only other measure they have stated is to announce later on, presumably near the peak, for all household members to also self quarantine if someone in their household has the symptoms.
How that would work exactly is not too clear because presumably they need food and whatever else, but they have stated UK is expected to follow the same trajectory as Italy, but not necessarily the same measures.
Presumably because closing so much activity maybe doesn’t delay or even prevent the spread to the most vulnerable group because they would be more in contact, and all at the same time, with family members who probably have the virus as ministers, celebs, everyone is getting it.
Thus hopefully the Brits will be smarter about this and the Americans as this isn’t something that is just going to go away regardless of the level of hysteria, but something we all have to go through with, in a hopefully smartly managed way instead of in a way that just copies authoritarians despite those measures seemingly not being effective at all and maybe even were counterproductive.
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