The pattern the professor describes shows little variation regardless of the way the virus is addressed. From Marina Medvin at townhall.com:
Professor Yitzhak Ben Israel of Tel Aviv University, who also serves on the research and development advisory board for Teva Pharmaceutical Industries, plotted the rates of new coronavirus infections of the U.S., U.K., Sweden, Italy, Israel, Switzerland, France, Germany, and Spain. The numbers told a shocking story: irrespective of whether the country quarantined like Israel, or went about business as usual like Sweden, coronavirus peaked and subsided in the exact same way. In the exact, same, way. His graphs show that all countries experienced seemingly identical coronavirus infection patterns, with the number of infected peaking in the sixth week and rapidly subsiding by the eighth week.
The Wuhan Virus follows its own pattern, he told Mako, an Israeli news agency. It is a fixed pattern that is not dependent on freedom or quarantine. “There is a decline in the number of infections even [in countries] without closures, and it is similar to the countries with closures,” he wrote in his paper.
“Is the coronavirus expansion exponential? The answer by the numbers is simple: no. Expansion begins exponentially but fades quickly after about eight weeks,” Professor Yitzhak Ben Israel concluded. The reason why coronavirus follows a fixed pattern is yet unknown. “I have no explanation,” he told Mako, “There are is kinds of speculation: maybe it’s climate-related, maybe the virus has its own life cycle.”
The world was headed into a ditch before the coronavirus, which is just the cherry on the sundae, to mix a metaphor. From Daniel Lacalle at mises.org:
In February, the general consensus between large investment banks and supranational entities was that there would be a one-time hit to GDP in the first quarter due to the impact of the coronavirus, followed by a stronger, V-shaped recovery. The IMF expected a modest correction of global GDP of 0.1 percent, and the largest cut on estimates for 2020 growth was 0.4 percent.
Those days are gone.
The latest round of global growth revisions includes a slash of growth estimates for the first and second quarters and a very modest recovery in the third and fourth. Average GDP estimates are now down 0.7 percent, and JP Morgan expects the eurozone to enter a deep recession in the next two quarters (–1.8 percent and –3.3 percent in the first and second quarters), followed by a very poor recovery that would still leave the full-year 2020 estimate in contraction. The investment bank also assumes US slumps of 2 percent and 3 percent, respectively, but a modest full-year growth. Capital Economics estimates a hit to the US economy for the full year that would cut 0.8 percent off previous estimates though still predicting growth, but a larger impact on the eurozone, with full-year 2020 growth at an avergae of –1.2 percent, led by a –2 percent prediction for Italy. This, unfortunately, looks like just the beginning of a downgrade cycle that adds to the issue of an economy that was already slowing in 2019.
The coronavirus threat may be overblown, but there’s no denying its impact on economic activity. From James Howard Kunstler at kunstler.com:
The shadow of Corona virus creeps ever-darker across the scene like a cosmic messenger from Karma Central telling mankind to stop and assess. We’re about to find out what we’ve wrought with the wonders and marvels of globalism. Is there anything you can think of over at the Wal Mart or the Walgreens that isn’t made in China? I mean, everything from a dustpan to a lint brush? I can’t say for sure, because I’m not over in China, but the place is apparently not open for business these days. One must surmise that a lot of activities in the USA may not be open for business much longer, either.
The action in my local supermarket yesterday had an undercurrent of stealth desperation; no overt panic buying, no fighting in the aisles, but an edge of suspense. Personally, I cleaned out an entire product-line of cat food, loaded up on cooking oil, rice, dry beans, and evaporated milk — and I wasn’t the only one checking out with the sixteen-roll bindle of toilet paper. Obviously, many products were still there on the shelves to get (minus that cat food). Is the time perhaps at hand when a lot of stuff won’t be? Just sayin’.
The message is getting out — though not from US authorities yet — that everybody may soon be spending a lot of time home alone. That’s exactly what has happened in China and a region of northern Italy. France banned events with more than 5,000 people (why that number, exactly?). Japan has canceled school for the time being — duration unknown for now. So a USA lockdown is not merely hypothetical. These, then, are two fundamental conditions the world faces for a while: nobody moves and nothing gets produced.
Governments will use the coronavirus to do what they always do: increase their power and screw things up. From Daniel Lacalle at dlacalle.com:
The John Hopkins University Coronavirus Global Cases Monitor shows that the mortality rate of the epidemic is very low. At the close of this article, 83,774 cases, 2,867 deaths and 36,654 recovered. It is normal for the media to focus on the first two figures, but I think it is important to remember the last one. The recovered figure is more than ten times the deceased one. This should not make the reader ignore the epidemic, but it is also worth reading the scientific study that shows that the death rate in citizens under 60 is less than 1.3%, 0.2% in young population, and on average it is a maximum of 4% (“The Epidemiological Characteristics of an Outbreak of 2019 Novel Coronavirus Diseases”, February 2020).
I have attended several debates in international media where scientists repeat these important factors to prevent panic reactions from the population. History shows us that these epidemics have diminishing mortality rates and are contained relatively quickly.
We must remember the victims and their families and pray for a quick response from the scientific community, a solution that will surely arrive… Although not in the time that market participants and media would desire.
The economic impact is completely different. There is more logic in the negative reaction of markets because the coronavirus impact adds to an already weak and bloated global economy that was showing poor growth, high debt and an evidently disappointing earnings season before any epidemic was included in estimates.