Viking

Thanks. We are doing great and not losing any sleep. Just staying informed exercising reasonable caution. +1

A new low from Trump. This is not leadership. So you don’t test (which causes more pain and suffering and more deaths of Americans) and then use the low confirmed cases as proof that you are doing a great job. This is disgusting. But it is totally predictable. His strategy is to go at his biggest failings and flip the script. I am surprised there is any testing going on in the US... Trump credits his own efforts, questions WHO stats President Donald Trump tweeted a pat on the back to his own administration for efforts to combat the coronavirus: "With approximately 100,000 CoronaVirus cases worldwide, and 3,280 deaths, the United States, because of quick action on closing our borders, has, as of now, only 129 cases (40 Americans brought in) and 11 deaths. We are working very hard to keep these numbers as low as possible!" - https://www.usatoday.com/story/news/health/2020/03/05/coronavirus-live-updates-us-death-toll-schools-amtrak/4953471002/

Viking, Please read my "rat lab" analysis of that particular situation about that cruise ship in Japan here. The realized "confirmed cases" [infection] rate ended up at ~ 19 percent, the death rate ended up at ~ 0.16 percent. I think that today, everyone then on board has left the ship. John, thanks for the clarity. I will be more careful/clear when quoting numbers :-) I was talking about infected people (696) so the death rate right now is a little under 1%, with 35 serious and 478 still active. Bottom line, a cruise ship is the last place you want to be when a virus breaks out.

For the people who believe this virus is not a big deal, imagine if you or a loved one was on this cruise ship? We know that a cruise ship is the perfect breeding ground for the virus. The death rate for those who were infected on the cruise ship in Japan was 10% (i think). I am sure the 2,500 people on this cruise ship are going through hell right now. Coronovirus is a global health emergency; the sooner people figure it out the better it will be managed. U.S. official warns there isn’t capacity to quarantine all passengers from marooned cruise ship Ken Cuccinelli, the acting deputy secretary of homeland security, said Thursday that there is inadequate capacity at health-care facilities in the United States to accommodate bringing large numbers of cruise ship passengers ashore for quarantine, leading lawmakers to question whether authorities would again seek to quarantine coronavirus cases on a ship held offshore. The Grand Princess, which carries about 2,500 passengers, is marooned off California after a previous passenger died of coronavirus and workers aboard displayed symptoms. - https://www.washingtonpost.com/world/2020/03/05/coronavirus-live-updates/

+1

The question now is at what point does Washington State start to quarantine the hardest hit areas? This seems to be the play book in other regions in the world that lost control of the virus. The economic cost right now is too large for any public official to make the call. As everyone starts to understand the gravity of the situation (i.e. the confirmed cases skyrocket higher) they eventually will have no choice. At some point the fear of the health carnage will become greater than the current fear of the economic carnage. My guess is the quarantine will likely happen in stages. Right now they are telling anyone who can work from home to do so. High risk people should stay at home. Soon all schools will be closed. And then finally we will get to a full on quarantine for a couple of weeks. Again, i am basing the comments above on how other parts of the world where a cluster broke out handled the crisis. China, Northern Italy, South Korea and Iran. We will soon be adding Kirkland Washington to this list. And there is a chance that the US has discovered a new way to manage this crisis in Washington State where a quarantine is not required. One possibility is for the US to decide to let the virus spread from Washington State into all states to speed up the process of infecting their populations and getting through this crisis quickly. Yes, the death toll will be much higher with this approach but it is only a flu after all; mother nature at work :-) And as the President said last night the death rate is not 3.4% but closer to 1% (his hunch). Americans now feel much better. I would expect flights to China, Northern Italy, Korea and Iran to start up again any day.

ok. Now that more testing is happening we will start to finally get some data on what the current situation is. 2:08 p.m. Washington state cases reaches 70 The positive cases of novel coronavirus in Washington state rose from 39 to 70 in the last 24 hours, according to the state's Department of Health. There were no new deaths reported. Ten of the 11 deaths in the U.S. were in Washington state.

John, i live three hours from Kirkland. I was there with my son for his hockey tournament in November. Wonderful time; great people. Yes, it is a tragedy in the making. I cannot understand why they are not taking more aggressive steps. My guess is the health care professionals know they are screwed already. Seattle is too big to quarantine (3.5 million people). So this is going to get much worse and they will simply ‘do their best’.

The epicentre of the Coronovirus in the US is Kirkland, Washington (pop 90,000) located on the outskirts of Seattle (3.5 million). Today Washington State Public Health provided an update. Bottom line, the situation does not look good to contain this outbreak. It is clear from listening to the update (link posted below) the health care system there is already overwhelmed. They have 39 confirmed cases and 10 deaths (King and Snohomish counties). Bad, but not that bad... right? Keep reading... Even though they have a health emergency there is still limited testing going on in Washington State. They acknowledged there is ‘huge demand’ right now for testing. But there is limited capacity and they are ‘working hard’ to increase capacity. Up until yesterday, the criteria from the CDC for who could be tested was quite restrictive. Yesterday the CDC relaxed their testing requirements. People who have mild symptoms are being told they do not need to be tested. At Life Care, the longterm care facility (with 108 patients) where the outbreak first occurred last week the situation is grim. 5 patients have died from the virus and more are in serious condition. Most of the staff left when they started showing symptoms and are now in self quarantine at their own homes. So the long term care facility has been running on a skeleton staff. Quality of care for patients is poor and the facility’s ‘ability to function has gotten more difficult over time’. Sounds like things fell off the rails today. People who had no symptoms were not removed from the facility (but were separated at the facility from those who were showing symptoms) but family members fear they have now become infected. They are not able to test the residents. Those residents who are able to get into a hospital can be tested; those in the facility who cannot get to a hospital are not being tested and are being told that testing is not necessary anyway as they will still receive the same level of care for the condition they are in (whether they have the virus or not). Tomorrow (Thursday) they expect a Federal disaster medical team to arrive and provide much needed support. Family members are freaking out. There has been no communication from Washington State Public Health with family members who have loved ones at the facility; they are too busy. - CNN news article on Life Care: https://www.cnn.com/2020/03/04/health/washington-state-nursing-facility-coronavirus-family/index.html Family members who have been to the Life Care facility over the past month and likely exposed to the virus are not being contacted by health authorities (they are too busy). In the press briefing Washington State Public Health ‘asked’ these people to handle the issue on their own. The recommended actions that are being given to the larger community from Washington State Public Health are determined in consultation with the CDC based off the number of reported cases in the community. Because the reported number of cases continue to be low they are recommending only basic actions at this time (wash your hands, stay at home if you are sick, stay away from large groups if you are high risk, work from home if you can etc). But we know the number of reported cases are vastly understated (due to lack of testing). So the recommended actions are also likely behind the curve. Bottom line, the virus is winning the fight right now. This is going to get worse. But we aren’t going to hear how bad it is until they actually start to test in volume. I am starting to think BC and neighbouring US states may have to issue travel advisories for Washington State. At least until they get the situation under some kind of control. Because right now it looks to me like the virus has gotten a 4-6 week head start. I wonder if this is what happened in Northern Italy and South Korea (delay in identifying outbreak and then slow response by overwhelmed health care providers). King County Public Health, state health officials give update on coronavirus response - March 4 - 45 minutes - testing update: at 24 minutes - care home: at 28 minutes - what to do: at 46 minutes The comments section at the end of the video provide some clarity on how local residents are feeling

“A 17-year-old from Mercer Island created a website to combat misinformation about coronavirus -- and it's getting millions of views around the world.” I especially found the map feature interesting. You can zoom in to a specific geography and see source material for the numbers provided. - https://ncov2019.live/data

Don’t they know Coronavirus is just like the flu.... Clearly, the Italians are over-reacting! Italy says it will shut schools and universities as death toll passes 100 MILAN — Italy on Wednesday said that it will close schools and universities throughout the country in an attempt to control the spread of the coronavirus, as it battles the most serious outbreak in Europe. A total of 2,706 people have tested positive for the virus in Italy. The virus has hit the aging population of northern Italy particularly acutely. More than 10 percent of those who have tested positive are in intensive care, straining Italy’s health-care system, which is scrambling to add extra beds. Italian news agency Ansa reported that the government is also expected to announce another wide-ranging advisory that will ask Italians to change their lifestyle for the next 30 days. It will stipulate that people should avoid hugging, shaking hands and planning mass gatherings. Health officials say they are also considering extending a two-week lockdown in its cordoned-off quarantine zone, which covers the worst-affected places, or expanding the area.

Does anyone know how many Americans have been tested for the virus? I think as of this past weekend it was 473. I am hearing that testing is increasing in the US but can’t find any stats; it would be ideal to see the daily ramp in numbers. Also, once a test happens how many days does it take to get the result? I read in one article it is 4 days but can someone please confirm what the number is? Once we know testing is happening in large numbers and we add the days to process the test this should inform us as to what day we will begin to understand how many cases there might actually be in the US (and where). Right now i have no idea as testing has been so limited. I am simply trying to understand where the US is at in the process and when we can expect to get better information. ———————————— The Official Coronavirus Numbers Are Wrong, and Everyone Knows It - https://www.theatlantic.com/technology/archive/2020/03/how-many-americans-really-have-coronavirus/607348/

Great read; well articulated. Below is the key paragraph for me. Most people feel the virus is just a seasonal flu (and we all know a seasonal flu is no big deal for most of us). My guess is people in China, Italy, South Korea and Iran would not agree that what they are experiencing right now is the same as getting the flu (something they all have a lot of experience with as well). Big, big difference. How a country deals with this virus is hugely important in determining its impact. We should learn a lot in the next 4 weeks. “I want to acknowledge up front that ascertaining intrinsic value is never a simple, cut-and-dried thing. Now – given the possibility that the virus will cause the world of the future to be very different from the world we knew – is value too unascertainable to be relied upon? In short, I don’t think so. What I think we do know is that the coronavirus is not a rerun of the Spanish flu pandemic of 1918, “which infected an estimated 500 million people worldwide – about one-third of the planet's population – and killed an estimated 20 million to 50 million victims, including some 675,000 Americans.” (history.com) Rather, it’s one more seasonal disease like the flu, something we’ve had for years, have developed vaccines for, and have learned to deal with. The flu kills about 30,000-60,000 Americans each year, and that’s terrible, but it’s very different from an unmanageable scourge.”

What are people thinking will happen to the US$ moving forward (next year to two years)? Will we get a flight to safety where the US$ will strengthen? Is the plunge in the 10 year telegraphing anything for the US economy and the US$? The US$ has outperformed for so long will we now start to a change and a period of underperformance start. I am not trying to become a currency trader. But i do like to think about currency as an input into the decision of which where (regions) to invest.

LC, i am sitting here in the restaurant laughing like hell and everyone is looking at me like i am a nut. Best laugh i have had in a while and i needed that!

Zippy, thank you for posting. I think i have a much better understanding of why Taiwan only has 42 cases being so close to the epicentre of this hurricane. I was wondering why the virus is hitting some countries so hard and other countries much less so. So it sounds like countries that have a well thought out plan and strong execution can manage their way through this with minimal loss of life and economic damage.

Viking, To me actually quite striking, that the playbook suggested by Mr. McBride is to a wide extent similar to the playbook of the [Danish Health Athority and the Danish Government [, naturally with some modifications related to differences in societal systems the US compared to Denmark]. John, it is becoming very clear that countries with public health systems are much better prepared to deal with this crisis. Nice to hear that Denmark is being proactive (not a surprise).

The US is not testing (in volume) yet for the virus. If you don’t test the numbers will not go up. Now i am sure that there are many people who are looking at the low numbers of reported cases and reported deaths and concluding that the virus is not an issue and that people are way over reacting. Pence met with Democrats today: “Senators Patty Murray and Maria Cantwell of Washington state, which has had the only U.S. deaths so far from the virus, led the questioning in the closed-door lunch, multiple senators said.” “They demanded to know when more test kits would become available. Murray said later that for now, many residents are simply being told to stay home if they feel unwell — an untenable approach for many. “Testing, testing, testing. Be honest with people. Everybody hit on it. Tell us when the tests are going to be available,” Cantwell told reporters after the lunch. “People are calling their doctors, and they’re not being able to get a test, so let’s get crisper and clearer about what the process is for people to get testing and when the availability of those tests will be there for them."

Calculated risk blog has some suggestions of what political leadership should be considering. Very thoughtful. - https://www.calculatedriskblog.com/2020/03/a-few-comments-on-covid-19-non-medical.html 1.) First, Let the experts brief the public, not politicians. 2.) Second, the government should take the advice of the experts at the CDC and elsewhere and increase funding immediately as required by the health professionals. 3.) Third, testing should be increased dramatically, and testing should be free for all in the US with any symptoms (or closely exposed to an infected person). It should be free for the uninsured, and for illegal immigrants (there should be no citizenship test). This is critical or people will not get the test. 4.) Fourth, for those that test positive (but don't need hospitalization), the experts should determine how to isolate them. If their employers will not pay for their time off, then the government should pay. We don't want people avoiding tests because of the costs or the fear of lost income. 5.) Fifth, the government should have a program of low interest rate (or no interest) loans for otherwise healthy companies impacted by the epidemic. “These are the kinds of programs that the government could put in place fairly quickly, in addition to what the healthcare experts suggest. In addition to the usual safety nets, these policies - well publicized - would lower the transmission rate and provide the proper stimulus to the economy (directed at exactly the right people).”

Greg, i think it was a ‘cover your ass’ cut. On a daily basis Trump has been hammering away at the Fed to do a 50 point cut. The ball is now back in the President’s court. The big news to me is the 10 year treasury. It is in freefall and went below 1%.

+1 In most instances, it is impossible to prevent the spread of a pathogen like this. So, you do what you can to slow the rate of infection. (1) Implement social distancing early on; (2) Implement widespread testing to find, isolate, and treat patients; (3) begin development of a therapeutic; and (4) Begin development of a vaccine. This is basic epidemiology 101, but the people that coordinate this work for the Federal Govt are gone, moved along/out due to the current administration. In the United States, we have the ability to do #3 and #4 quickly (relatively speaking). I'll bet there is a vaccine available in early 2021. The problem, in the meantime, is what the morbidity and mortality rates will look like in the meantime, and the extent to which our hospital system is overwhelmed by people seeking treatment. If we (US society) were intelligent, we would bite the bullet now, and: 1. Close schools for 3 weeks; 2. Close daycares for 3 weeks; 3. Close gov offices for 3 weeks; 4. Direct gov employees and private sector employees to stay home and telework for the next 3 weeks. 5. Roll-out diagnostic testing to anyone who thinks they may be sick, or have been in contact with infected individuals. 6. Cover the cost of #5 so that people are not discouraged from seeking out testing. Unfortunately, we have a president that is 100% concerned about re-election. And as a result, none of this will happen until it is to late. A lot of what's on this list will need to happen. It may happen one region or one state at a time. Once the playbook is created, the rest of the regions or state will iterate and improve it further, but are unlikely to do less than that. The best mindset to have is to believe it will show up in our community tonight or tomorrow, and to prepare accordingly. If it ends up being anything less than that and in a few months we are still here discussing missing out on 10% stock gains, wouldn't that be a great outcome to have. +1 Watching business TV today is painful. They are trying to predict what is going to happen in the next month or three. There is no discussion on what the root issue is: the response of the government and health care system right now to this virus. Your assessment of the effectiveness of the response today is what will inform your perspective of what the economy will look like in the future. My guess is there are very good reasons it is not being actively debated/discussed.

I am shocked that people do not understand the absolute importance of doing everything possible to slow this virus in the very early stages. And every stage after that. Sounds like people still do not understand this virus and its potential to cause a severe human and economic tragedy. We have a real world example of what happens when a government does not take the issue seriously and do everything possible to slow this virus in the early stages: Wuhan If you do not find a way to slow it the virus it will overwhelm your medical system. If you do not understand why, then you need to educate yourself. If you think this virus is simply a little worse than the flu (so what's the big deal?) then you need to educate yourself. Holy shit! I posted a video of what Wuhan has been through and what they had to do to get the virus under control (re-posted below). Watch this video if you haven’t. Their key mistake was their inactivity the first two weeks. The incompetence of the government resulted in a human and economic tragedy. - And if you want real-time information of how well the US is currently responding to this virus I posted this CNBC interview from yesterday. The doctor (who is on the front line) explains in very clear language what the issues are and what needs to be done. -

Thought provoking post. Why does it blow up in some areas and not others (in the same country)? Making me think :-)

So if this is being "handled" incorrectly, what is your hypothesis? Is it: 1) People in the US are actually getting sick from Covid-19, but are electing to not seek medical help? 2) Doctors across the US (who generally work in private practice and are not public employees) are treating people for respiratory illness, they suspect Covid-19, but are failing to inform local public health authorities? 3) Local public health agencies in thousands of cities in the US are collaborating to not test people to confirm the existence of Covid, and they are also collaborating to not forward presumptive diagnoses or suspected cases to the state public health agencies? 4) The 50 different state public health agencies are in cahoots to hide the real numbers from the federal government and are forwarding incorrect numbers to the CDC? So, in your book, where are the facts being hidden? SJ SJ, did you watch the 8 minute CNBC video i recently posted? I think the doctor more than answers your question.

LOL Russia. 3 cases. 2 cured. They must be rigging the virus. Im still waiting for someone to connect why the likely or even less likely and more severe scenario warrants, lets say, Google losing $100B in value? One quarter of really ugly numbers? Two? A year? How ugly should those be? Lets say it goes on for a full year and figures contract 35%! Surely a rational investor would pay, lets say 20x trough earnings for a company like Google. Is the doomsday scenario 11% downside? How scary. No one seems to be quantifying anything in any terms that translate to anything of significance for investments. And no one has really answered the question, what if we only end up with numbers that resemble the flu? Does that kill the markets? I mentioned early last week how people I was speaking with were telling me restaurants in Chinatown were seeing traffic down 40%. And that people in other parts of the country have noticed nil. So obviously the effects will ripple into some areas of life. Others probably not. You want to give me Madison Square Garden at a $5B EV because of a year of the flu? OK.... give it to me. All day. If nothing else, thing is perfect long/short territory. You'll likely have such volatility for a short while that you dont even need to be a good investor just cover shorts when market goes down and flip longs when it goes up and gradually taper short exposure as this plays out. I think the real economic risk is if the US has to lock down regions where this really breaks out. Kirkland, Washington will be the first test and we should know more in about two or three weeks. If lock down is the answer then this will cause significant economic disruption. After that, it really depends how many ‘clusters’ in the US are incubating currently. Because of pretty much no testing the past month one has to assume a fair bit as this virus is very contagious. It is like a small meteor randomly hitting a region in the US. Not causing a huge amount of death but causing short term economic damage. We just don’t know how many meteors are coming and what their size will be. The crazy thing is we still know so little. Will warm weather slow it? Perhaps, but don’t know yet. Will it resurface in the fall? Probably, but don’t know yet. Will it ‘bomerang’ and re-infect already hit areas? Don’t know. Bottom line, fasten your seat belts as the ride is just getting started. Looks to me like the bond market sees what is coming with the yield on the 10 year treasury down again today to 1.12%. The stock market? Up 5%. It is rallying because of expected central bank easing. Not sure that is going to help in this situation.