Panic Attack*

Panic Attack

The February 18th TLR (“The China Virus”) addressed the potential healthcare-medical and healthscare-economic consequences of the Coronavirus. It pointed out that governments and healthcare providers will continue to take appropriate steps designed to avoid a healthcare pandemic: “However, past results are not necessarily indicative of the future spread of a new virus.” And, yet, Wall Street’s armchair epidemiologists previously opined that, like SARs, AIDS, the 2009 H1N1 swine flu, and Ebola, the Coronavirus soon would be brought under control. They’ve since changed their tune. Whether or not the world’s governments and healthcare providers are able to bring the Coronavirus under control, they have been unable to control the spread of fear and the consequent economic and political fallout that fear-of-contagion – panic – has brought. As the 21st Century again has proven, facts can be ignored and emotions allowed to rule the day. People will choose to believe what they want to believe. And nothing therefore can prevent the public from panicking. The facts thus far, however, suggest that a healthcare-medical panic is overblown. A healthscare-economic panic may not be.

Although healthcare professionals and governments may have good reason to believe that the Coronavirus will be brought under control, the media has been spreading fear, sending the message that the Coronavirus is a dangerous health threat to each and every individual in the United States. The fact is that the Coronavirus is similar to a highly-contagious flu, most likely a bad flu: “Health experts say if the new Coronavirus continues to spread in the U.S., the result could be similar to a bad flu season, where emergency rooms and health clinics are crowded, and death rates are higher than normal.” The Centers for Disease Control (CDC) has estimated that since 2010 there have been up to 45 MILLION cases of influenza each year in the U.S. with 140,000-810,000 hospitalizations and 12,000-61,000 DEATHS PER YEAR. Those are frightening numbers. Were you aware that the flu was so prevalent and so deadly? And, yet, the influenza epidemic in the U.S. hasn’t led to panic. It hasn’t created a media frenzy … or even a healthscare. Preliminary estimates by the CDC for the current flu season indicate that there were 32 MILLION flu cases and at least 16,000 influenza deaths in the U.S. through February 15th. Those flu fatalities are more than 5 times the number of worldwide Coronavirus fatalities to-date …, almost all of which have been in countries without America’s healthcare facilities. Coronavirus fatalities in the U.S. in 2020 are unlikely to approach that number – though the Coronavirus likely will lead to potentially disastrous healthcare consequences in many low- and middle-income countries where, as Bill Gates has written, “health systems are already stretched thin, and a pathogen like the Coronavirus can quickly overwhelm them.” The Coronavirus (1) is highly contagious, yet (2) over 90{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of those infected apparently have mild reactions, and (3) fewer than 10{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of those infected have serious reactions – it’s primarily those who have existing health/respiratory problems who are at-risk. The World Health Organization has said that the mortality rate to-date has ranged from 0.7{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} to 4{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} depending on the quality of the health-care system where it’s been treated …, and almost all treatments to-date have been outside the U.S. Interestingly, if the Chinese government is to be believed (and there are reasons to doubt everything the Chinese government says), the spread of contagion inside China has been brought under control, as has the death rate (see the table at the end of this commentary). (The advantage of authoritarianism – centralized government management – in dealing with a disaster like this is that China can lock down a city or a province, quarantining tens of millions of people, control the media and the reporting agencies, and marshal its top experts, allowing them to wage a campaign against the disease with absolute, uncontrolled, unanswerable authority; however, it can’t avail itself of the benefits of public trust that prevail in Western countries, including transparent and honest accounts of the disease, its toll, and its consequences.)

With a worldwide population of over 7 billion, there have been fewer than 90,000 reported cases, 80,000 in China – and undoubtedly many, many more unreported ones, all in China. There have been 3,000 deaths worldwide, again almost all in China. Over 1.3 billion people live in China, where the virus originated and where it spread rapidly because of the Chinese New Year for many reasons. Even so, after 2 months of a raging internal epidemic, China reportedly has seen fewer than 3,000 deaths out of a population of 1.3 billion people – 0.00023{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35}. As stated above: Preliminary estimates by the CDC for the current flu season indicate that there have been at least 16,000 influenza deaths in the U.S. through February 15th. Assuming that the number of Coronavirus cases in China is being underreported (both because those with mild illnesses are not reporting – estimated by some to exceed 90{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of those infected – and because China’s government is lying underreporting in order to avoid panic), the fatality rate is likely less than 1{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} … in a country without the healthcare resources of the U.S. Based on existing cases, people in danger of serious or fatal illness are those with compromised immune systems …, and children under the age of 10 appear to have a high level of natural immunity.

Media have not been highlighting the constructive facts, only the dreadful ones, which is one reason why fears in the U.S. have been escalating – despite the close similarities the Coronavirus outbreak bears to an controllable outbreak of the flu. Words matter and the words being used by the media intensify distress. The repetition of terms and phrases like “pandemic” and “once-in-a-century pathogen,” coupled with the repeated refrain that the inability to quickly trace an infected person to the source is a bad thing, and the minute-by-minute update on the number and locations of those infected, add kerosene to what is perceived to be – but is not – a raging health-fire. The numbers to-date are neither surprising nor calamitous – that is, for Americans, not for Chinese or Iranians – and from a medical perspective …, not an economic one. It’s important to keep those numbers – and those differences – in mind. America has a population of more than 330 million and there have been only a handful of reported cases … and only ~6,000 worldwide outside of China. Even a million cases in America wouldn’t be cause for alarm. There have been 32 MILLION flu cases in America this season alone. The chances of Coronavirus infecting any individual American remain exceedingly small and the risks of serious illness miniscule. In the pre-vaccine 1950s, measles was estimated to infect 3-4 MILLION Americans EVERY YEAR (with a far smaller U.S. population), and kill or cripple thousands, not counting the virulent complications that all-too-often followed a measles infection. Similar – and worse – diseases have afflicted humans since the beginning of time, although we’ve mistakenly come to believe that virtually all disease has been eradicated … forever. That’s not the case …, and influenza proves that (as do many other diseases that only minimally plague Americans). The influenza and measles numbers exceed what currently appears to be happening with the Coronavirus pandemic WORLDWIDE. It’s fortunate that the fatality rate of the Coronavirus is proving to be relatively low and concentrated on those with existing health problems – although a 1{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} fatality rate is horrifying and means that practical precautionary measures necessarily must be taken. Measles killed up to 50{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of those populations that lacked natural immunity. The Coronavirus isn’t close to being as deadly.

With that said, there can be little doubt that Coronavirus cases will increase at a rapid rate and do so until at least late Spring … and it is then likely, though not certain at this early stage, that cases will tail off. Like the flu, the Coronavirus can be expected to recur when Winter returns, and (at best) to wax and wane with the seasons like the flu and the measles …, until there’s a vaccine. A vaccine can’t be expected for at least 12-18 months. As a consequence, everyone should be prepared to deal with Covid-19 for the foreseeable future.

The media is spreading panic about the Coronavirus because that’s what the media do … and social media in the 21st Century consistently echoes and accelerates messages of fear. Fear brings focused attention, more viewers and more dollars. That’s not to minimize the risks of catching the Coronavirus …, or the flu, or the measles … or any other contagious disease. Practical precautions are necessary.

Although the medical consequences from the Coronavirus to individual Americans may be overstated, the same is not true of the economic consequences, and the resulting panic, that’s hit the world’s stock markets. What’s hoped-for is that history will report that “The Stock Market Panic of 2020” was a one-week affair, a Profligate Panic. Nevertheless, global supply chains have been disrupted and consumers have ceased consuming …, at least for the time being …, although it seems likely that the disruptions and reduced demand will continue for at least the next few months. If so, the world’s economy may not merely slow, it may contract …, by how much is impossible to know …, and the world’s stock markets, and individual investors, will feel the pain. That justifiably creates fear … and spreads it … and brings panic … but only of an economic, and not a medical, sort. Even so, economic contraction is not a foregone conclusion. From an economic perspective, panic is not justified by the realities. In fact, some are forecasting that the Federal Reserve (the “Fabulous Federal Reserve” discussed in the April 19th TLR), the European Central Bank, the Bank of Japan, and their brethren – the world’s Central Bankers – will soon step in to sooth the markets and take the pressure off the global economy: “We believe that market volatility and uncertainty about global growth are bringing us ever closer to a co-ordinated, ÔÇÿwhatever it takes’ moment from global policymakers.” Prudence, however, dictates caution. Although it’s wisest to hope for the best, it’s equally wise to plan for the worst. TLR’s commentaries on brewing economic and political storms have raised the question of how long existing excesses can be maintained. It is entirely possible that the Coronavirus will become the seeding event. Practical precautionary measures should be taken.

Finally (from a good friend)

*┬® Copyright 2020 by William Natbony. All rights reserved.

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