Coronavirus: Panic Begins

The rapid spread of the coronavirus in Italy, on top of clusters in South Korea and Japan, has finally kicked officials in some countries into panic, even if they aren’t sure what to do.

By Yves Smith of Naked Capitalism.

Despite what the unprecedented lockdown of areas in China that produced 70% of its GDP, and the use of hazmat suits, revealed about what Chinese officials were seeing, the rest of the world remained oddly complacent about what the novel coronavirus meant for them. How reassuring was it really if the disease had moderated as a result of the effective quarantining of the population, a condition that was clearly not sustainable? And there was the oddly optimistic view that a country of 1.2 billion could effectively be cordoned off from the rest of the world…particularly after it became clear the lockdown was implemented after the cornoavirus was meaningfully underway?

As our Ignacio has pointed out, it is disconcerting how much we still don’t know about this disease. It has a troublingly long incubation period, raising the possibility that some can harbor low level infections for a long time by normal contagion standards. Individuals can repeatedly test negative yet later develop the coronavirus. The Journal of Hospital Infection reported that human coronaviruses can live as long as nine days on surfaces…but alcohol will kill it in a minute.

The rapid spread of the coronavirus in Italy, on top of clusters in South Korea and Japan, has finally kicked officials in some countries into panic, even if they aren’t sure what to do. And this follows shortly on the mishandling of the two cruise ships with infected passengers and crew. But outside the business press in the US, there’s not much evidence of concern.

And on the business front, the reality is sinking in that it isn’t clear when China might get back to a semblance of normal operation. For instance, insiders leaked that the FDA had prepared a list of 150 medications, including some with no substitute, that were at risk of shortages. Equity markets, which had been complacent, are now looking rattled. South Korean averages are down more than 3.3%, the Hang Seng is off nearly 1.5%, US and European stock futures are off, and oil fell by over 3%

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