Coronavirus

[Dalal.Holdings]

The death rate is 20x - 200x worse. Why are people still playing devil's advocate with everything with absolutely no data to support it?

 

The flu death rate is pretty well documented as somewhere around 0.1%.  20x seems like it could be correct, but potentially up to 200x worse than that??  I could counter your "Where's your data to support that", because that's way over the highest estimate made by anyone ever.

 

What will it take for you to believe this is a big deal?

 

1. Flu is also a big deal, which just isn't properly covered by the media. So, when you read xxx people have died in a country from the corona virus, you think: that's a lot and start to panic; when xxx people die because of the flu, you will never know.

2. Corona virus is an ever bigger deal than the flu, because it can potentially in the future become much bigger as nobody got immunity (yet). When flu season hits, we do nothing except vaccinate some elder people with a vaccine that doesn't really work that well to begin with. This hits, and we shut down entire countries. I'd say that response from countries we are seeing over the last three days is proportional to this being a big deal.

 

This can become an unnecessarily deadly disease if we do nothing.

 

I agree.  Fortunately, Europe has been taking action these last few days, lots of it in fact. I was under the impression the US wasn't far behind, but perhaps I'm mistaken.

 

On 3/6/20 WHO CV situation report stated that the common flu has a death rate well below 0.1%.

 

Here they show the CFR of ~0.055% for 65+ year olds in the Americas:

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6815659/

 

Here are the numbers for China:

https://twitter.com/YoloCapMgmt/status/1238954857949585408

 

Yeah, it's much less than 0.1%, but rounded up to 0.1% because the average person would not understand a number smaller than 0.1%...

 

This is much deadlier than the flu and we have already refuted the "just another flu arguments" many times on here. Ignore those who make them.

[StevieV]

I am very confident we will not see a repeat of 2008. I am becoming more confident a recession is coming and if some of the second order effects kick in it could be worse.

 

I don't see how a recession is avoided.  Can't shut down so much and have the social distancing without causing a recession.  I think most else is up in the air.  Among other things, depends what happens with the virus, which I think is pretty speculative.  Could it recede over the summer and come back strong in the fall?  Maybe.  Never recede that much?  Yo-yo with corresponding yo-yo policy responses?  When will a vaccine arrive?  Any treatments before that?

 

Why are you very confident we will not see a repeat of 2008?  I am hopeful that this is viewed, and turns out to be, somewhat temporary and businesses act according.  That government makes reasonable policy decisions, and that we get a short recession with a bounce-back.  No confidence of that though, just think it is possible and am hopeful.  Wouldn't be surprised by a longer or deeper recession either though, for all the reasons you mention.

 

Many businesses and people aren't prepared for such a quick and large slowdown (some aren't prepared for any at all).

[sleepydragon]

Holy shit. King Donald is going nuclear. If you do not do what he wants, you are going to be replaced with a yes man. Strong message to send to public service in a timeof crisis. Financial markets are going to have a shit fit if he demotes/fires Powell right now.

 

But we know Trumps play book. He KNOWS what needs to be done. And if a public official does not do what Trump wants they are gone. There will be no ‘independence’ moving forward.

 

The virus has not even hit the US yet (in numbers). If he starts doing these sorts of things when times are good (trust me times are good right now) just imagine what he is going to do when times actually start to get bad?

 

Yes, i know this is all priced in to stocks... (sarcasm). The more desperate Trump gets the more financial markets are going to sell off.

 

Trump says he has the right to dismiss or demote Fed Chairman Powell

- https://www.marketwatch.com/story/trump-says-he-has-the-right-to-dismiss-or-demote-fed-chairman-powell-2020-03-14

 

It would be funny (in a sad way) if Trump got rid of Powell and put someone there who would give him negative rates...and that might just be enough to spiral the world into something possibly worse than 2008.

 

Where this really gets wicked are the secondary effects and the tail risks. What if the US policy responses are the wrong ones? The more Trump messes up the worse he makes the situation - a classic negative feedback loop.

 

The real question: what is currently stopping Trump from doing really destructive things? Democratic House is not enough. Will the Republican Senate stand up to Trump? Not so far...

 

The stock market will figure this out at some point and discount it...

 

Only coronavirus.

But .. he just tested negative.

 

[arcube]

Brits are known for creating herd immunity!

 

Mad cow disease spread in British herds in the mid-1980s after they were fed the processed animal remains of sheep infected with scrapie, a closely related brain-wasting disease.

[Guest]

In 2006 almost no one thought a 2008 scenario would happen. It is still really, really wild if you stop and think about it. There were companies that were around for 100+ years that went down.

 

Will this be a bank credit crisis like 2008? Probably not. Will stock prices drop 50%? Will it turn into some type of liquidity event? Who knows. Markets can go quite crazy. All I know is that if you're going to play this game, you have to be able to withstand those 50%+ drops.

 

As Buffett said in the most recent annual report:

 

"That rosy prediction comes with a warning: Anything can happen to stock prices tomorrow. Occasionally, there will be major drops in the market, perhaps of 50% magnitude or even greater. But the combination of The American Tailwind, about which I wrote last year, and the compounding wonders described by Mr. Smith, will make equities the much better long-term choice for the individual who does not use borrowed money and who can control

his or her emotions. Others? Beware!"

[Spekulatius]

Dalal.Holdings,

 

By all means, please keep your posts coming here on CoBF.

 

I wholeheartedly agree with this.

 

[Read the Footnotes]

Couple of quick points based on skimming the previous pages:

1. Herd immunity is an important part of any approach to the process. Different countries have different options and different challenges.

2. Prevention is better than cure, especially when there is not a cure

3. Early action saves money and lives in the long run

4. Mixed messages create panic, costs lives and costs money

5. Every assumption I've seen in the past 5 or 10 pages of posts about how long this will take is likely WAY too optimistic. This is a marathon, not a sprint.

6. Things are changing very rapidly all over North America right now. The people who are involved in making the changes are too busy to be arguing on this board right now.

7. The national guard will likely to be visiting your town soon

8. China is NOT back to normal. The social distancing measures and hygiene practices there are extreme still. Just because life goes on does not mean things are back to normal. They aren't going to be for some time.

 

[arcube]

Excellent summary RTF. Thanks.

 

Couple of quick points based on skimming the previous pages:

1. Herd immunity is an important part of any approach to the process. Different countries have different options and different challenges.

2. Prevention is better than cure, especially when there is not a cure

3. Early action saves money and lives in the long run

4. Mixed messages create panic, costs lives and costs money

5. Every assumption I've seen in the past 5 or 10 pages of posts about how long this will take is likely WAY too optimistic. This is a marathon, not a sprint.

6. Things are changing very rapidly all over North America right now. The people who are involved in making the changes are too busy to be arguing on this board right now.

7. The national guard will likely to be visiting your town soon

8. China is NOT back to normal. The social distancing measures and hygiene practices there are extreme still. Just because life goes on does not mean things are back to normal. They aren't going to be for some time.

[Viking]

Stevie, my comment was more along the lines that this crisis will follow a very different trajectory than 2008 (with no idea of magnitude). People often get anchored in the past to make sense of the current situation. I am trying to learn what is really going on in China and Europe; that seems to be informing what will perhaps happen here much better than what happened in 2008. There is so much we still do not know; an open mind and being inquisitive is key.

 

The real question for investors is how low will the stock market ultimately go amd how long will ‘it’ last. Of course no one knows. If this is bear market, which it could be, i think stocks fall on average about 35% and the recession lasts about 10 months. If this is a real doozie stocks could fall 50% from their highs.

 

The policy response from leaders is critical.

 

As of today the US stock market is down 20% from its highs and trading about where it was trading 12 months ago. And the virus has not even hit the US yet. We will know much more but it will take 2 or 3 weeks more to fully understand what is going on. And then the impact will last 4-6 more weeks after that. What a shit storm. We know things are going to get worse we just don’t know how much worse. Not a great set up for stocks. Now perhaps this is all priced in to stocks down 20%; i don’t think so.

 

The wild card, as has been stated already is human ingenuity. My guess is we see lots and something big at some point in the next 12 months, just impossible to predict what and timing.

[LC]

All I know is that if you're going to play this game, you have to be able to withstand those 50%+ drops.

Paul, I was actually thinking of the C Munger quote earlier this week as we saw such crazy volatility:

 

"In fact, you can argue that if you're not willing to react with equanimity to a market price decline of 50% two or three times a century you're not fit to be a common shareholder, and you deserve the mediocre result you're going to get compared to the people who do have the temperament, who can be more philosophical about these market fluctuations"

[Liberty]

 

Thread by: “ computational/system biologist working on infectious diseases and have spent five years in a world class 'pandemic response modelling' unit. ”

[arcube]

Thank you, Liberty. All tweets in one page here.

 

https://threadreaderapp.com/thread/1238837158007447558.html

 

 

 

Thread by: “ computational/system biologist working on infectious diseases and have spent five years in a world class 'pandemic response modelling' unit. ”

[mcliu]

If you think it’s bad in the US then we’re really fcked up here in Canada. No travel ban yet, lax airport security, no emergency declared, lowest hospital bed per capita, very limited hospital capacity, colder climate..

Economy-wise, mostly o&g and commodities, no big tech, housing bubble..

[Castanza]

Dalal.Holdings,

 

By all means, please keep your posts coming here on CoBF.

 

Will do. Can't believe we have people still saying there is no advantage to acting early when we see countries coming out of this who acted early. And then going on guessing that there will be future outbreaks again and mutations/etc so why bother doing anything (absurd). There was also earlier the "they're old people who were going to die anyway" shocking mentality.

 

The "we're all screwed anyway" mentality makes absolutely no sense (and some of these people were initially saying "no big deal, just the flu".

 

And calling this a supply shock when it is clearly a demand shock...

 

Absurd. Almost as absurd as comparing a passenger in your backseat to a cinder block and saying human bodies become projectiles in car crashes and that's why we have seat belts, but oh well--the absurdities keep coming.

 

1.) I never said testing or prevention wasn’t important. I said targeted testing is probably best.

2.) I did say testing is a game you’re playing from behind at this point an likely isn’t going to be as effective as if it were implemented immediately.

3.) herd immunity will eventually be an important factor especially knowing a vaccine likely isn’t going to be that effective.

4.) I have agreed this is going to have big economic impacts, there is no denying that. I think it’s wayyy to early to assume that countries who have “tested early” are going to be “way better off” than others. China isn’t anywhere close to being out of the storm yet.

 

For shits and giggles:

 

https://www.google.com/amp/s/abcnews.go.com/amp/GMA/story%3Fid%3D128062%26page%3D1

 

 

 

[DocSnowball]

@ReadTheFootnotes thank you for that summary, and for everyone sharing their thoughts!

 

Definitely a lot of panic and anxiety amongst healthcare workers I'm in touch with across the Northeast US (my wife and I are both physicians). A survey amongst Infectious disease specialists across the US done last week showed near universally problems with access to testing, anticipated shortages of personal protective equipment (we are already running out of N95 respirators in hospitals before this thing has really hit), and poor communication from organizational and administrative leadership to the frontlines. If we see base case numbers like we are seeing across Europe, I'm concerned about how many healthcare workers will be exposed to COVID.

 

It is crazy that NY is not preparing to shut down officially. I think both coasts will see near or full lockdowns within the next week as hospital admissions and deaths mount (remember "riding in to save the base"). Our healthcare system is simply not prepared (or designed) for anything like this. So far actions from the top and the team paraded on Friday have not matched the press conference words so far. I'm half expecting markets to again deliver the message until lockdowns are in effect.

 

Reading this post about projections sent a chill down my spine (no it is not peer reviewed but fwiw):

https://medium.com/@tomaspueyo/coronavirus-act-today-or-people-will-die-f4d3d9cd99ca

 

Be well everyone.

Sleep well, stress less, and eat healthy (not too much sugar).

Continue to check in daily on this board to have a community amongst the mayhem that awaits.

[orthopa]

Contact tracing will obviously no longer work in the US. That is an opportunity the US has missed. 

 

We must start social distancing immediately, including cancelling public events, and reducing exposures to large groups.

 

Marc Lipsitch, the Harvard Epidemiologist has a thread here:

 

 

Weren't we just arguing about this in my example of extended contact at airport ? Now because he says it, its true? LOL

 

Orthopa, do you think you can slow down a bit and try to communicate a little more clearly? I think you are making some good points, but it seems your points may not be getting across clearly or that you may even be misunderstood. This post in particular makes me think that is the case.

 

I also thought your earlier point about testing the role of testing in a diagnosis is likely a good point, but was probably too hasty to get your point across. Maybe some other medical professionals could weigh in on that, especially if you're to busy to respond.

 

I dont know how much more I can slow down. I have probably posted 50 times? Trying to get some points across. Am I completely right?, of course not but I have experience FWIW. Others have graphs,  twitter links, and or political angles which are underwhelming at best sometimes.

 

Again points that I have made that I believe are true FWIW (we are allowed an opinion right?)

 

1. The virus has been here for months, likely early January and has been seen/dealt with in the health system under other diagnoses for months.

2. The first test confirmed, was not the first test here.

3. There was nothing the government or any nation in the world could do to stop the initial spread

4. Older people and those most at risk will die. There is no cure, and viruses kill people. Elderly people should take appropriate precautions.

5. Because the virus has been here for months testing is borderline useless and your going to chase your tail the entire time. This is due to numerous contacts and the extended incubation period.

6. If you don't test everyone the virus will continue to spread quickly, again via asymptomatic people and kids. Best policy is to test everyone, but its impossible and too late.

7. Best way to prevent spread is standard precautions! This includes isolation, hand washing, yada, yada. NOT TESTING.

8. If a patient test positive and there has been minimal definite contacts say someone who is home bound with a handful of contacts testing may make sense but these are limited cases.

9. The the spring/summer will bring a reprieve in new cases and hopefully that was well as the fact that nearly everyone will have been exposed or infected this will limit virgin hosts.

10. A vaccine is useless if the virus mutates significantly.

11. The number of cases are vastly under reported, probably numbering in the millions by now in the US.

12. If someone you know or yourself had a cold/URI/flu symptoms that tested negative, and was "way worse" then the common cold there was very high chance it is/was the corona virus.

13. Every case of the virus is not severe, so don't model it as such. Corona virus dx does not = ICU and ventilator.

14. I believe eventually those in charge medically will come to the conclusion that its inevitable that this becomes a pandemic with everyone getting infected in time.

15. If your human, you will get the virus in your lifetime. Nothing you can do.

16. Flattening the curve makes sense but I question when the curve will bump as the virus again likely has been here for months.

 

The virus finally hit my back yard. Told ya guys!

 

https://www.wgrz.com/article/news/health/coronavirus/3-erie-county-residents-test-positive-for-coronavirus-cuomo-says/71-059af4e0-657f-4de6-9c4c-692b105ee327

 

""We believe there are thousands of people who have coronavirus, maybe tens of thousands. We believe there are thousands of people, maybe tens of thousands who have had coronavirus and have resolved that never knew they had it. So the 524 cases doesn't mean there are 524 positive people. It means the testing capacity is going up."

 

This should be evidence enough any calculation regarding death rate is completely useless. And its Cuomo, a democrat who hates Trump for all you partisan guys!

 

Again question for everyone expecting dooms day. Slowly its coming to the realization 10s of THOUSANDS of people had the virus but the ERs aren't slamming yet? What gives???

[investmd]

If you think it’s bad in the US then we’re really fcked up here in Canada. No travel ban yet, lax airport security, no emergency declared, lowest hospital bed per capita, very limited hospital capacity, colder climate..

Economy-wise, mostly o&g and commodities, no big tech, housing bubble..

Hmmm...Canada does have an advisory against international travel, does have recommendation for self quarantining for 2 weeks post international travel, doctors have been requested not to travel abroad so that they can be present to help treat, governments have mandated that schools be closed in New Brunswick, Quebec, Ontario & Manitoba, there is no formal entertainment going on - restrictions on gatherings have been placed...@ the grassroots level in Canada I find no one is shaking hands, meetings are being cancelled, there is alcohol based sanitizer everywhere....

Hospital capacity is what it is. However there are plans in place for closing OR's and turning them into ICUs if necessary.

Bank of Canada has slashed interest rates, government has issued liquidity. Overall, from what I can see Canada is doing an exemplary job.

[mcliu]

If you think it’s bad in the US then we’re really fcked up here in Canada. No travel ban yet, lax airport security, no emergency declared, lowest hospital bed per capita, very limited hospital capacity, colder climate..

Economy-wise, mostly o&g and commodities, no big tech, housing bubble..

Hmmm...Canada does have an advisory against international travel, does have recommendation for self quarantining for 2 weeks post international travel, doctors have been requested not to travel abroad so that they can be present to help treat, governments have mandated that schools be closed in New Brunswick, Quebec, Ontario & Manitoba, there is no formal entertainment going on - restrictions on gatherings have been placed...@ the grassroots level in Canada I find no one is shaking hands, meetings are being cancelled, there is alcohol based sanitizer everywhere....

Hospital capacity is what it is. However there are plans in place for closing OR's and turning them into ICUs if necessary.

Bank of Canada has slashed interest rates, government has issued liquidity. Overall, from what I can see Canada is doing an exemplary job.

 

But US has all the things that you’ve listed and then even more and everyone here is saying the US response is botched and they’re just waiting for Italy to happen so...??

[orthopa]

https://www.yahoo.com/news/dont-panic-says-us-woman-recovered-coronavirus-055155667.html

 

Interesting story seems to vibe with some of the things orthopa mentioned earlier.

 

Seems to? LOL.  This is what is GOING ON!!!!

 

Again. I treat patients in an ER and have been seeing this for weeks!!!! We just went back and retrospectively called all of our negative flu swabs from my clinic for 6 weeks. All 1450 people recovered NO ONE DIED. There were 2 hospital admission. Again no way to know if these were corona positive but again.....we are in a pandemic right?? ??? ??? ??? ???

 

are you holding cash or mostly invested?

 

Mostly/fully invested. Eventually as more people are tested we will find the death rate plummets and thousands and thousands if not millions had the virus and recovered and were asymptomatic.

 

We are slowly getting there. Cuomo is on board!

[orthopa]

 

Did I misinterpret or misrepresent anything here?

 

I think you have an excellent understanding of this at this point, and apparently able to put it down on paper better then me.

 

Thanks.  Just trying to make sure I fully understand the various perspectives.  Again, apologies again for the comment before re: the profession you've chosen.  It meant no disrepect.

 

I do want to ask you - if you were to take a step back and think about your position, where could you be wrong?

 

I could be wrong by how much of a hit this will be to the ICU/need for respirator, ie breakdown of health system. I can only think back to working during the H1N1 outbreak and the 17-18 flu season and that volume load which was ~15 million cases if I recall correctly. The system was stretched, but did not collapse, My opinion is the virus has been here for 6 weeks/months and cases are vastly under reported. So in my mind we are currently in an environment of where many think we will be from documented patient 1 say 4-6 weeks from now, already!  Its in this mind frame I have a hard time rectifying a wickedly high death rate and medical system collapse if we are operating in this environment currently.

 

I certainly could be wrong on this, I hope I'm right of course. We will see. The fact of the matter is if the cases are severely under estimated and we are handling it now maybe we are further along on the curve then we think, and handling it fine.

 

Again, hope Im not wrong. We will see I guess....

[Gregmal]

If you think it’s bad in the US then we’re really fcked up here in Canada. No travel ban yet, lax airport security, no emergency declared, lowest hospital bed per capita, very limited hospital capacity, colder climate..

Economy-wise, mostly o&g and commodities, no big tech, housing bubble..

Hmmm...Canada does have an advisory against international travel, does have recommendation for self quarantining for 2 weeks post international travel, doctors have been requested not to travel abroad so that they can be present to help treat, governments have mandated that schools be closed in New Brunswick, Quebec, Ontario & Manitoba, there is no formal entertainment going on - restrictions on gatherings have been placed...@ the grassroots level in Canada I find no one is shaking hands, meetings are being cancelled, there is alcohol based sanitizer everywhere....

Hospital capacity is what it is. However there are plans in place for closing OR's and turning them into ICUs if necessary.

Bank of Canada has slashed interest rates, government has issued liquidity. Overall, from what I can see Canada is doing an exemplary job.

 

But US has all the things that you’ve listed and then even more and everyone here is saying the US response is botched and they’re just waiting for Italy to happen so...??

 

Well, I think anyone with some observatory skills can tell you why that is.

[EliG]

If you think it’s bad in the US then we’re really fcked up here in Canada. No travel ban yet, lax airport security, no emergency declared, lowest hospital bed per capita, very limited hospital capacity, colder climate..

Economy-wise, mostly o&g and commodities, no big tech, housing bubble..

Hmmm...Canada does have an advisory against international travel, does have recommendation for self quarantining for 2 weeks post international travel, doctors have been requested not to travel abroad so that they can be present to help treat, governments have mandated that schools be closed in New Brunswick, Quebec, Ontario & Manitoba, there is no formal entertainment going on - restrictions on gatherings have been placed...@ the grassroots level in Canada I find no one is shaking hands, meetings are being cancelled, there is alcohol based sanitizer everywhere....

Hospital capacity is what it is. However there are plans in place for closing OR's and turning them into ICUs if necessary.

Bank of Canada has slashed interest rates, government has issued liquidity. Overall, from what I can see Canada is doing an exemplary job.

 

Re the bolded part:

 

investmd, I don't know where you live. Here in Ottawa, our surgery wait times are already unacceptably long. Turning ORs into ICUs will make them even longer. Hip and knee replacements can wait, I guess. What about cancer? The Ottawa Hospital is struggling to meet Ontario target times for certain types of cancer surgeries. My understanding is that OR availability is the main bottleneck. You seem to think that turning ORs into ICUs is not a big deal. Why is that?

 

[meiroy]

I am very confident we will not see a repeat of 2008. I am becoming more confident a recession is coming and if some of the second order effects kick in it could be worse.

 

I don't see how a recession is avoided. 

 

1. Households QE.

2. Later, massive infrastructure projects.

 

 

edit: while increasing households' demand the USA would have to protect itself as other economies will simply apply a beggar thy neighbor to suck a lot of this demand/consumption away. 

 

 

 

 

 

[meiroy]

He’s insane

 

 

Obviously.  But what about his circle of enablers?

[Casey]

I am very confident we will not see a repeat of 2008. I am becoming more confident a recession is coming and if some of the second order effects kick in it could be worse.

 

I don't see how a recession is avoided. 

 

1. Households QE.

2. Later, massive infrastructure projects.

 

We should build out some of those influenza-specific hospitals that China has. Seems like they're damn useful.