THE CORONAVIRUS IS PLAGUING EVERYTHING

Language is a virus from outer space. ~ William S. Burroughs 

The media has been hoisting up their flagpoles multitudinous covid-19 stories that cover everything and anything related to this novel virus. Including politics, given that it’s just 236 days before the presidential election. We’ve been told by the president that covid-19 is part of the Democrats’ plan to capture the election from him. The Chinese state media has encouraged their citizens to believe the coronavirus originated in the US, so as to deflect any blame on Xi Jinping, China’s hallowed premier. It’s difficult now to recall that this coronavirus was discovered in Wuhan less than three months ago, given its swift spread among the media and politicians.

Historians have revived horrific facts about the 1918 Spanish Flu pandemic that killed roughly 50 million people worldwide, including 675,000 people in the US and 12,500 in my hometown, Philadelphia. The president’s uncoordinated, ineffectual efforts to deal with covid-19 so far have been roundly criticized for several reasons, including for forgetting what we learned from this 102-year old flu pandemic. The Administration apparently botched big time the production and distribution of viral test kits, with serious, continuing consequences. Last week, the Surgeon General pleaded with the public to not buy any more N95 masks because medical providers cannot find any. And anyway, these masks aren’t as preventative as people assume. Really; how could a million Chinese be wrong?

We are told the unfortunate news of when yet another person has died from covid-19 in the US. Today, 30 people have now died, and 975 cases have been identified. Lost with the singular focus on covid-19 is that our “regular” seasonal influenza affects 32 million people, with several hundred thousand hospitalizations and 18,000 deaths, according to the CDC.

Here in the Bay Area we have been regularly informed about the dire straits of the 2,421 passengers (and 1,113 crew members) aboard the Grand Princess cruise ship. It was  finally allowed to dock in Oakland on Monday after much delay and hand-wringing [and despite the Vice President’s prior diktat that the ship would not berth at any “US commercial port”]. Last time I looked – today – the port of Oakland was operating commercially. Oh well. As everyone now knows, 45 people on the ship were tested for coronavirus and 21 tested positive, 19 of them crew members. The rest of the 3,516 people are being quarantined in many places.

Is this daily tidal wave of information helping? I doubt it, mostly because it rarely offers any perspective. Instead it’s magnifying two other well-known infectious viruses, anxiety and fear. These widespread public anxieties have cleared the shelves across America of facial masks, hand sanitizer, toilet paper and bottled water.

Going beyond items that used to be on isles 8 and 9 at your local drug store, increasing numbers of people have been inquiring about how to survive the coming pandemic. I’m not talking about a taking an ibuprofen, earning a Ph.D. in hand-washing or getting vaccinated, whenever that becomes available – at least a year away. No, these folks believe the apocalypse (aka, covid-19) is already upon us and they want to be fully prepared.

They are headed for them thar far hills and “going survivalist.” One story mentions a woman named Lynx who teaches a 10-day introduction for surviving wilderness living in the in the wilds of central Washington State. No surprise, her business has picked up recently. She believes that before too long the backwoods’ wilds will include feral rewilded people like herself, escaping the virus. In other locations, covid-19 is providing teachers of “bushcraft techniques” with growing numbers of willing applicants who want to prepare for viral catastrophe and beyond, along with other “SHTF” events (I expect you’ll figure out this acronym in no time) that will typify upcoming darker times.

But let’s return to more hospitable and familiar landscapes, which I think still exist. Despite of the abundant lack of relevant epidemiological information about the coronavirus, several incompatible forecasts have already been offered that characterize covid-19’s potential effects, when it becomes a WHO-designated pandemic. In epidemiology jargon a pandemic is a disease that has spread across multiple continents (covid-19 has already done this all too well) and become a serious, worldwide epidemic (that hasn’t officially happened, yet), although it has been detected in at least 97 countries so far. What is the WHO waiting for, one wonders?

Oxford Economics, a British consultancy, provided one of the first macroeconomic covid-19 impact forecasts last week and said the virus would reduce 2020 global GDP by 1.3%, or $1.12 trillion. The International Monetary Fund ran its macro models through a “covid-19 scenario” and expects the virus will reduce global growth this year by 0.1%, to just 3.2% over last year. We’ve been treated to many accounts of how covid-19 will cause a recession not just here in the US, but in China and Italy. Then there’s the stock markets.

The stock markets’ take on covid-19 has been startling for two reasons. First, we’re at the very commencement of this viral attack. Much more will follow. Yet market drops are already dramatic. Second, the virus has conveniently been labeled as “the cause” of last week’s big drop in the Dow and S&P500 indices, as well as many other equities. However, market valuations for some time have been stretched beyond what the tenuous global economy or business performance merit. Thus, financial markets have had lots of potential room to fall. And fall they have, despite today’s partial rally. Covid-19 is a timely and expedient reason for the tumble that requires no erudite rationale.

Additionally, central banks around the world have already used up most of their fiscal medicines to sustain continued gains. Now that the Fed last week responded within hours of #45's misplaced demand for a "big rate cut," our central bank has joined the covid-19 shoot-out in our fiscal OK Corral. It's the largest rate cut at one time since the 2008 financial crisis. I think this interest rate cut is like pushing on our "loose string" macroeconomy; it will have minimal effect. Instead, a fiscal policy that directly puts dollars in folks' pockets now should be implemented. Such a needed  policy will require agreement from both Congressional Democrats and Republicans. Should we hold our collective breaths? I hope so.
    Meanwhile monetary policy is stymied. Negative interest rates in Europe account for about half of all European public bonds. More than $14 trillion worth of corporate and public debt around the world has negative yields (interest rates). Currently 10-year Treasury notes yield only 0.456%, the lowest ever. Blaming the coronavirus for all this is ludicrous, but quite opportune. Our fiscal reality has been solidly covidified.

Published economic effects of covid-19 largely remain guestimates because no one yet has reliable values of several key epidemiological parameters of the coronavirus, including: its dispersion among people (how is the virus spread among people); its incumbency period (before infected people show symptoms, can they infect others?); its susceptibility, what types of people are most susceptible (what ages, races, etc.; so far relatively few diagnosed covid-19 infections involve very young people, but many older adults); its seasonality; its case fatality rate (CFR) of those infected, how many die; and its reproductive rate (R value; which represents the number of subsequent cases each new case will produce).

This understandable and inevitable lack of information about the brand-new coronavirus hasn’t stopped politicians from riding their hobbyhorse solutions, like Medicare for All, payroll tax elimination or universal sick pay. Also, despite little technical understanding or perspective, the media has been broadcasting all sorts of “advice” for us miserable wretches living in the now-proclaimed “covid-19 era”, including stories like: “Will the US go into lockdown from the coronavirus?”, “Cancel Everything” and “Politics in the Age of Coronavirus: No audience for the Democratic Debate on Sunday.” Fortunately, Elizabeth Warren now doesn’t need to write another plan. Perhaps Cardinal Voiello can offer spiritual guidance.

In spite of all of this, we can tread water hopefully and calmly as the media’s virus-related tsunami threatens to wash us into seas of doubt, anxiety, anger and fear. But don’t forget to vigorously bathe your hands.