Coronavirus

[Spekulatius]

Economic impacts - This moves with breakneck speed:

 

Brother in law got laid of in CA. He worked (in accounting)  in a hotel in SF, which went from full occupancy to almost zero.

 

A friend from my town rents apartments to lower income people in our area. He is already seeing defaults on rent payments. Many work in restaurants etc. He will work with renters and probably needs to forgive a few month of rent (he thinks).

 

All the initial economic estimates for China were way too optimistic; virus caused much larger economic contraction than expected. And the re-start has also been slower to materialize.

 

The challenge in the West is we are taking a very different approach to managing the virus than China, South Korea, Taiwan and Singapore. Our approach is the blunt ‘flatten the curve’ (social distancing followed by lock down) but without all the other measures implemented in the asian countries. I am starting to think that our blunt strategy is going to need to be in place for longer (2-3 months).

 

Recession is coming. If this lasts months then likely a severe recession. If it stretches into 12-18 months then what is worse than a severe recession?

 

Recession is already there. In Trumps words, the unemployment numbers will probably increase by the greatest rate ever.

 

I live in the US for more than 20 years and it constantly surprised me how quickly everything can unravel. The renters that our friend from town rents to are hardworking folks (he selects them carefully and has done this for decades), but they have nothing to fall back so he literally collect the rents weekly. That’s why they are already out of means because this crisis started 3 weeks ago. I don’t think any of them has health insurance either. Even if their employer would offer cobra, they can’t afford it anyways.

 

In Germany, workers get out on “Kurzarbeit” for many month for partial pay and they keep the health insurance which then is free without much income, so they can last a long time. That’s why the Great Recession in Germany wasn’t that big of deal for the most folks there.

 

Perhaps the $1000 checks for everyone are a partial solution in this situation.

[John Hjorth]

ERICOPOLY & no_free_lunch,

 

Please look here.

[Castanza]

There’s no way China style lockdown can or should happen here. If you look at archived Chinese social media, they were literally locking people inside their houses. Doors to entire apartments were welded shut. Infected people rounded up and forced into quarantine hotels. Public apology/denunciation for not wearing face masks.

 

Japan, Korea have shown that there’s ways to contain virus without taking away all your rights. You don’t need to lock everyone up, people just need to pay attention and avoid close contact. Face mask and glove wearing should be encouraged.

 

Also, in many ways, we are dealt a better hand in the Canada/US, many of us live in houses in much lower density areas. We also drive our own cars instead of mass transit. There’s also good delivery and internet infrastructure and many can work from home.

 

Never say never but it would be tough. 300k guard members and 900k law enforcement officers gives you what 25kish per state? Road blocks are about as effective as you can be (see 9/11 response).

 

Just remember folks, when seconds count, the police are only minutes dozens of minutes away!

[RichardGibbons]

And what a fool he has been to voice the opinion that it's NOT China's destiny to surpass the USA in GDP - that our

country and citizens were worth fighting for against a Chinese juggernaut.

 

So, I'm curious how you resolved the cognitive dissonance between being a passionate Trump supporter on China with the belief that the government should try to keep away from business. It feels like, if America wants to go this path of eliminating China from supply chains, it requires either massive tariffs or extreme regulations--basically the government completely destroying the supply chain of many businesses.

 

(FWIW, I agree with you that Western countries ought to disassociate from China for all the reasons you say, but I can say that because I'm fine with government interfering with business for the greater good.  But I don't see how one solves this problem if one believes the non-interference of government in business is the greater good.  Can you enlighten me?)

[Spekulatius]

Anyone concerned they the health insurers may run into financial issues as well? People getting laid of in drives reduces their membership and those that stay may get their money’s worth if this epidemic goes out of control. Of course right now with everything elective being on hold and many practices only taking emergencies, the cost trends may be really great.

 

The chart looks like they caught the flu already.

[fareastwarriors]

Anyone concerned they the health insurers may run into financial issues as well? People getting laid of in drives reduces their membership and those that stay may get their money’s worth if this epidemic goes out of control. Of course right now with everything elective being on hold and many practices only taking emergencies, the cost trends may be really great.

 

The chart looks like they caught the flu already.

 

Publicly traded Health insurers have been consolidating. They are can probably withstand the hit and can put downward pressure on health providers when needed. 

[cubsfan]

And what a fool he has been to voice the opinion that it's NOT China's destiny to surpass the USA in GDP - that our

country and citizens were worth fighting for against a Chinese juggernaut.

 

So, I'm curious how you resolved the cognitive dissonance between being a passionate Trump supporter on China with the belief that the government should try to keep away from business. It feels like, if America wants to go this path of eliminating China from supply chains, it requires either massive tariffs or extreme regulations--basically the government completely destroying the supply chain of many businesses.

 

(FWIW, I agree with you that Western countries ought to disassociate from China for all the reasons you say, but I can say that because I'm fine with government interfering with business for the greater good.  But I don't see how one solves this problem if one believes the non-interference of government in business is the greater good.  Can you enlighten me?)

 

Richard - no simple answer because I am a free trade believer as well.

 

But like our energy situation of 20 years ago - was it really wise to be reliant on Iran, Iraq, Venezalua, etc for our energy needs?

Isn't this country in a vastly better situation now being energy self sufficient?

Of course we are - and perhaps a combination of government policy on drilling and American ingenuity made the difference.

 

That's what I'm saying about China - and our key industries like drugs, medical and tech.

Clearly we don't want to be dependent on them for ALL or a MAJORITY of this anymore.

Like players in the Middle East - why be overly dependent on people that hate us and we can't trust?

 

Certainly we wouldn't do it for defense products - as a country we need to prioritize those key businesses.

 

So how government moves us in that direction - trade wars, tariffs, tax holidays to bring cash home, etc - we ought to get there.

 

And if Trump makes us see the benefits to employment opportunities for our citizens - it's just another bonus for the country.

After this disaster, we are really going to needs those jobs.

 

Like many things in life - you make these tradeoffs for the national interest and our citizens.

[ERICOPOLY]

and those that stay may get their money’s worth if this epidemic goes out of control.

 

If it truly gets out of control, there will be no hospital bills for many. 

 

Unless hospitals turn away uninsured, the amount of uninsured that they treat will rise.  Using my imagination, the amount of insured patients at hospitals could actually fall if enough lost their insurance.

 

[ERICOPOLY]

Hospitals are canceling elective surgeries to make room for the onslaught.  That's going to hurt them big time because those are their big cash cows.

 

And in their place, they will see a rise of uninsured and the insured people they see won't be as lucrative as the surgeries lost.

 

I believe, anyway.

[Castanza]

Hospitals are canceling elective surgeries to make room for the onslaught.  That's going to hurt them big time because those are their big cash cows.

 

And in their place, they will see a rise of uninsured and the insured people they see won't be as lucrative as the surgeries lost.

 

I believe, anyway.

 

Our governor said he was going to fine any surgeon who chooses to perform an elective surgery...Even though we are nowhere near over capacity yet.

[minten]

I'm 100% convinced life will resume for the young, as you won't be able to hold them down anymore.

 

Some stats from Italy you don't want the kids to know.

 

Average age deceased: 80

Average nr of pre-existing conditions per deceased: 2.7

Total deaths among people with no pre-existing conditions:  3 out of 3000 (as of yesterday)

 

I can appreciate why policy makers would like to spin this as something that also affects young people, as you need them to comply and can't count on them to do it on solidarity alone. But the stats on who dies just don't seem to support it, except on an anecdotal, outlier level. And millions of young people will willingly spend their summer indoors over this?  I just don't buy it. Maybe a month, if we're lucky.

[Liberty]

The Diamond Princess remains the population where everyone was tested.  We can confirm that it was disproportionately elderly, and 1% died.

 

How long was that cruise (with those passengers), how long was the virus on it, how long was patient 0 asymptomatic vs symptomatic (probably much more contagious after that), and how long after that did they try to lock things down and create extra hygiene measures?

 

There's a lot of variables that makes this not as clear cut a case study as some would want it to be.

 

I generally agree with the points you raise, and that they are good signs, but there's still all these other questions.

 

I mean, it's very different if it's a one-week long cruise, patient 0 spent 4 days on it asymptomatic and then was able to infect all those people in just a few days after that before lockdown, than if it was a two-week cruise, he/she got on board sick from day 1, there was no lock down until the end, etc..

[KCLarkin]

Total deaths among people with no pre-existing conditions:  3 out of 3000 (as of yesterday)

 

This is such a useless stat. What percentage of the population has no pre-existing conditions? 40% of Americans ages 20-39 are obese according to a quick Google search. In the US, 33% of adults have high blood pressure.

[Liberty]

Total deaths among people with no pre-existing conditions:  3 out of 3000 (as of yesterday)

 

This is such a useless stat. What percentage of the population has no pre-existing conditions? 40% of Americans ages 20-39 are obese according to a quick Google search. In the US, 33% of adults have high blood pressure.

 

Yep. Diabetes and obesity are also co-factors for complications. That's a lot of people in the US.

[Casey]

The Diamond Princess remains the population where everyone was tested.  We can confirm that it was disproportionately elderly, and 1% died.

 

How long was that cruise (with those passengers), how long was the virus on it, how long was patient 0 asymptomatic vs symptomatic (probably much more contagious after that), and how long after that did they try to lock things down and create extra hygiene measures?

 

There's a lot of variables that makes this not as clear cut a case study as some would want it to be.

 

I mean, I generally agree with the points you raise, and that they are good signs, but there's still all these other questions.

 

I mean, it's very different if it's a one-week long cruise, patient 0 spent 4 days on it asymptomatic and then was able to infect all those people in just a few days after that before lockdown, than if it was a two-week cruise, he/she got on board sick from day 1, there was no lock down until the end, etc..

 

I think another big issue w/ extrapolating from the cruise ship stats is that they are from a time when the healthcare system was functioning normally. Perhaps it shows a lower bound for CFR? But if quality of care drops from hospitals getting hundreds/thousands of cases at once its going to be worse.

[minten]

Total deaths among people with no pre-existing conditions:  3 out of 3000 (as of yesterday)

 

This is such a useless stat. What percentage of the population has no pre-existing conditions? 40% of Americans ages 20-39 are obese according to a quick Google search. In the US, 33% of adults have high blood pressure.

 

I agree. But that wasn't really my point; stats show this is so overwhelmingly an old sick mans disease, the young who actually still work and need to make a paycheck but now can't, will eventually look at these stats as well when they run out of money to feed themselves.

[ERICOPOLY]

Total deaths among people with no pre-existing conditions:  3 out of 3000 (as of yesterday)

 

This is such a useless stat. What percentage of the population has no pre-existing conditions? 40% of Americans ages 20-39 are obese according to a quick Google search. In the US, 33% of adults have high blood pressure.

 

Yep. Diabetes and obesity are also co-factors for complications. That's a lot of people in the US.

 

The Chinese CDC put the overall mortality rate at 3.4% I believe, but they said the mortality rate was 10% for those with heart disease and 6% for those with diabetes.

 

I imagine though if you are 80 with diabetes your risk is far different than if you're 30 with diabetes as the disease has been beating up your body for longer.  Or if you're older your heart disease is more advanced on average.

[Liberty]

I agree. But that wasn't really my point; stats show this is so overwhelmingly an old sick mans disease, the young who actually still work and need to make a paycheck but now can't, will eventually look at these stats as well when they run out of money to feed themselves.

 

Dying isn't the only thing that can happen with the virus. It's not that binary. Many young people can still get severe pneumonia, which can leave long-term damage on the lungs. The virus can also in certain case apparently attack the heart and leave it weakened.

 

And some pneumonia cases that wouldn't be a big deal in a normally functioning health system may turn bad if the system is overloaded. Not to mention that all the other things that can happen to younger people (car crash, whatever) may also become a lot more dangerous if hospitals are overloaded and doctors and nurses and burnt out and/or sick, ambulances aren't available, etc.

[minten]

I agree. But that wasn't really my point; stats show this is so overwhelmingly an old sick mans disease, the young who actually still work and need to make a paycheck but now can't, will eventually look at these stats as well when they run out of money to feed themselves.

 

Dying isn't the only thing that can happen with the virus. It's not that binary. Many young people can still get severe pneumonia, which can leave long-term damage on the lungs. The virus can also in certain case apparently attack the heart and leave it weakened.

 

And some pneumonia cases that wouldn't be a big deal in a normally functioning health system may turn bad if the system is overloaded. Not to mention that all the other things that can happen to younger people (car crash, whatever) may also become a lot more dangerous if hospitals are overloaded and doctors and nurses and burnt out and/or sick, ambulances aren't available, etc.

 

OK sure, that's fair. But do you really think the odd chance of this happening will convince the under 50's to forego summer?

[Liberty]

https://www.forbes.com/sites/joshuacohen/2020/03/19/nationwide-lockdowns-can-begin-to-halt-the-spread-of-coronavirus-in-a-matter-of-weeks/#16a53c3212e1

 

In Italy, the country hardest hit by Covid-19, the government has implemented step-wise lockdowns, first a partial lockdown in the province of Lodi beginning the 23rd of February, followed by a national lockdown that started last week.

 

For those who want to see evidence of “flattening the curve” representing numbers of new coronavirus cases look at the figure below. Lodi was on lockdown starting February 23rd, while Bergamo did not follow suit until the national lockdown last week. Cases in Bergamo continued to rise steeply, as they did undoubtedly in other parts of the country. In Lodi, the curve flattened.

 

 

China:

 

[Spekulatius]

Hospitals are canceling elective surgeries to make room for the onslaught.  That's going to hurt them big time because those are their big cash cows.

 

And in their place, they will see a rise of uninsured and the insured people they see won't be as lucrative as the surgeries lost.

 

I believe, anyway.

 

That’s not the health insurers problem though. Health insurance is a good business and short tail too. Rates gets negotiated every year and costs just passed through.

 

There is some risk of a catastrophic surge in claims I guess, but I think if such a thing happens, they get bailed out too.

[ERICOPOLY]

Hospitals are canceling elective surgeries to make room for the onslaught.  That's going to hurt them big time because those are their big cash cows.

 

And in their place, they will see a rise of uninsured and the insured people they see won't be as lucrative as the surgeries lost.

 

I believe, anyway.

 

That’s not the health insurers problem though. Health insurance is a good business and short tail too. Rates gets negotiated every year and costs just passed through.

 

There is some risk of a catastrophic surge in claims I guess, but I think if such a thing happens, they get bailed out too.

 

Well, the US Navy hospital ship won't bill them.

[ERICOPOLY]

I don't see how hiding the jobless claims is going to bring confidence to investors who are trying to price risk into stocks.  I don't think Trump realizes he's making it worse -- what govt statistics can be trusted?

[Liberty]

I don't see how hiding the jobless claims is going to bring confidence to investors who are trying to price risk into stocks.  I don't think Trump realizes he's making it worse -- what govt statistics can be trusted?

 

Making things worse is his M.O.

 

He thinks it might help with the election. It’s all about him.

[Guest cherzeca]

why our covid-19 response is so stupid:  https://www.nytimes.com/2020/03/20/opinion/coronavirus-pandemic-social-distancing.html