Coronavirus

[meiroy]

alwaysdrawing,

 

For me, major banks refer to commercial banks, not investment banks.

 

 

[DocSnowball]

interesting well-argumented contrarian opinion piece from an epidemiology professor on why fatality ratio of this virus might be much lower than we think:

 

https://www.statnews.com/2020/03/17/a-fiasco-in-the-making-as-the-coronavirus-pandemic-takes-hold-we-are-making-decisions-without-reliable-data/?utm_content=buffere08f7&utm_medium=social&utm_source=twitter&utm_campaign=twitter_organic

 

minten, thank you for posting. This explains why testing i.e. accurate information is a critical factor in early stage viral outbreaks.

 

For all we know, widespread testing could show the severity of this virus is totally overblown as critics on this thread have suggested, and therefore the pandemic responses are unwarranted. Our portfolios and emotions could have been spared much stress.

 

 

Oh boy, Ioannidis is the author of one of my favorite contrarian pieces of all time:Why most published research findings are false (an excellent read and on the money)

https://journals.plos.org/plosmedicine/article?id=10.1371/journal.pmed.0020124

 

The only way to solve this dilemma is serologic (antibody) testing in a closed population like a small village or town, or even the Diamond princess for starters to know how many of the asymptomatic still mounted antibodies. He makes a good point about not extrapolating mortality rates from early cohorts onto the entire population. Or better said, what the final case fatality rate will look like will be different from the initial numbers look like. It's just we don't have any choice but to assume the worst for now.

 

However, the only reasonable path right now is social distancing to buy more time. Instead of thinking it will solve the problem, it may be better to think of it as a bridge. If you're not thinking ahead about where the bridge will take you and what you'll need at the other end, the problem can go on with multiple second order effects. This is where both diagnostic testing for cases, and serologic testing for estimating infection and case fatality rates may become key to making evidence guided decisions. 

[DocSnowball]

I wonder what the outcome would be like if the "shelter in place" orders only applied to households containing a person who is 65+ yrs of age, or has chronic health conditions.  And focus the bail-out dollars on sustaining them and delivering food/care to them until a vaccine arrives.

 

The rest of the population, after three months, would have developed "herd immunity" and normal life could largely resume.

 

Great idea. I would love for Trump to be “sheltered in place”. The sooner the better :-)

This may be a framework/ strategy after the 2-3 week hiatus ends...a phased resumption of social and economic activity while protecting the high risk population a bit longer until it is clear the resumption is progressing without the numbers going up again.

[wescobrk]

I have been short some going into yesterday but I realized that 30% down is not nearly enough as this can be worst than 08. I bought a lot of puts yesterday afternoon into the rally. I'm glad I did. I think we have at least another 10-20% down from here.

Millions of jobs are going up in smoke. The unemployment rate will skyrocket.

It will be just like in 08 when Congress wouldn't pass Tarp. Certainly, we will tackle this and things as early as 4 weeks may already have the market bottoming but I'm so glad I put a lot of puts on. If we are down 12% today like last week I'll switch to going long in very strong balance sheet companies.

I might even put my toe in the water in some of the strongest restaurant names but I know there is still huge downside for restaurants.

[stahleyp]

Well...this would be Great Depression-like:

 

https://www.cnn.com/2020/03/17/politics/steven-mnuchin-unemployment-warning-coronavirus/index.html

 

Unemployment then hit about 25%.

[wescobrk]

I hope we don't see rioting.

40% of the country has less than $400 according to that Fed study, right? How can we avoid mass looting?

[matts]

I hope we don't see rioting.

40% of the country has less than $400 according to that Fed study, right? How can we avoid mass looting?

 

How much money do you need? If you don't pay your phone bill, AT&T won't cut you off. If you don't pay for ANY utility right now, no one will cut you off.

 

You won't be spending money on gas, leisure, hobbies etc. You're just buying food right now. I think most Americans have credit cards right? Trump is trying to send the checks by end of april and I'm betting most of the banks will waive the credit card interest if you really need it.

 

Finally, most Americans will still be getting their next couple of paychecks because most Americans have normal jobs.

 

[minten]

I wonder what the outcome would be like if the "shelter in place" orders only applied to households containing a person who is 65+ yrs of age, or has chronic health conditions.  And focus the bail-out dollars on sustaining them and delivering food/care to them until a vaccine arrives.

 

The rest of the population, after three months, would have developed "herd immunity" and normal life could largely resume.

 

It's a good idea, and it seems likely after a few weeks of semi-lockdown and more data about how dangerous this virus really is (or isn't), it'll come to something like that.

 

I believe the idea of a society going in lockdown for monts and months over this is absurd and will never happen;  at some point the cure really does become a bigger threat than the disease itself.

 

 

[meiroy]

 

The next employment report will be released on April 3rd, right?  The unemployment numbers...

[ukvalueinvestment]

I wonder what the outcome would be like if the "shelter in place" orders only applied to households containing a person who is 65+ yrs of age, or has chronic health conditions.  And focus the bail-out dollars on sustaining them and delivering food/care to them until a vaccine arrives.

 

The rest of the population, after three months, would have developed "herd immunity" and normal life could largely resume.

 

It's a good idea, and it seems likely after a few weeks of semi-lockdown and more data about how dangerous this virus really is (or isn't), it'll come to something like that.

 

I believe the idea of a society going in lockdown for monts and months over this is absurd and will never happen;  at some point the cure really does become a bigger threat than the disease itself.

 

Yes I think society will quickly arrange itself into a semi permanent containment strategy.  eg at my work (US investment bank in London), most staff were sent home this week, when earlier than day the plan had been for split teams working one week in the office, one week off.  I think having the whole team work from home is not sustainable and we will move back to that split strategy.  It makes sense to have stringent restrictions for older population.  This will go on for many months and "isolation shaming" will become the norm.  ie at some point it will become "uncool" for people to go to bars and their peers will shame them for doing so.  Already supermarkets are opening at certain times just for older people  Society will come up with all sorts of solutions like this.  Aim is just to slow the virus down, work out what drugs have some sort of dampening effect, work hard for vaccine, not overwhelm health services.

[wescobrk]

I hope we don't see rioting.

40% of the country has less than $400 according to that Fed study, right? How can we avoid mass looting?

 

How much money do you need? If you don't pay your phone bill, AT&T won't cut you off. If you don't pay for ANY utility right now, no one will cut you off.

 

You won't be spending money on gas, leisure, hobbies etc. You're just buying food right now. I think most Americans have credit cards right? Trump is trying to send the checks by end of april and I'm betting most of the banks will waive the credit card interest if you really need it.

 

Good point. I need some caffeine to write more precise. Mass looting was a dumb statement but the rest of my comments I stand by about Congress, market downside, maybe a few stories here and there about looting but not mass looting.

 

Finally, most Americans will still be getting their next couple of paychecks because most Americans have normal jobs.

[wescobrk]

That's strange. My post didn't go through.

I put the mass looting question was hyperbolic but i stand by the rest of my other comments.

Probably just a story here or there about looting but not mass looting.

Thanks for challenging me.

[Orchard]

How much money do you need? If you don't pay your phone bill, AT&T won't cut you off. If you don't pay for ANY utility right now, no one will cut you off.

 

You won't be spending money on gas, leisure, hobbies etc. You're just buying food right now. I think most Americans have credit cards right? Trump is trying to send the checks by end of april and I'm betting most of the banks will waive the credit card interest if you really need it.

 

Finally, most Americans will still be getting their next couple of paychecks because most Americans have normal jobs.

AT&T is not in the bill collecting business. They'll send you off to collections at the exact same time as always.

[matts]

How much money do you need? If you don't pay your phone bill, AT&T won't cut you off. If you don't pay for ANY utility right now, no one will cut you off.

 

You won't be spending money on gas, leisure, hobbies etc. You're just buying food right now. I think most Americans have credit cards right? Trump is trying to send the checks by end of april and I'm betting most of the banks will waive the credit card interest if you really need it.

 

Finally, most Americans will still be getting their next couple of paychecks because most Americans have normal jobs.

AT&T is not in the bill collecting business. They'll send you off to collections at the exact same time as always.

 

Just not true. They won't be sending you to collections.

 

https://variety.com/2020/digital/news/cable-telco-not-cut-service-coronavirus-1203533615/

 

ok, it talks about cable cos, but it will be the same for all utilities. c'mon, companies are not dumb and will not want the massive PR hit. they will extend and pretend for as long as it takes and if they really need to, the government will give them some interest-free money (lots of avenue options) for being good boys.

 

 

[SharperDingaan]

As at 8:10 EST Dow Futures are down 821 points, largely offsetting yesterdays gains.

To most people it's pretty clear that monetary policy is done. We need different execution, and leadership. Not even lower rates.

 

Lenders are just being rationale; the credits are such utter sh1te, that it's far better to just let them collapse. Lend nothing further, cut losses, and try to recover as much as possible on the dollars already lent. CB execution would go a lot further, if they simply bought up the material portion of junk bond issues at cents in the dollar, and swapped the debt into majority equity positions. The reduced debt re-rating the remaining bonds high enough to permit open market operations. The majority equity positions enabling industry consolidation. Maximum employment, with minimum intervention.

 

US Shale is the main source of US junk, and it is collapsing. Airlines, and hotels/casinos are about to join them. Contagion.

That combined debt is so large, primarily junk, and so spread around, that you cant be sure if your banking counter-party is still going to be there. So the prudent thing is not to lend, rendering monetary policy ineffective.

 

It's time leadership stepped up to the plate.

 

SD

 

 

 

 

 

 

[Liberty]

A more optimistic take:

 

https://compoundadvisors.com/2020/apocalypse-interrupted

[Dalal.Holdings]

A more optimistic take:

 

https://compoundadvisors.com/2020/apocalypse-interrupted

 

The results speak for themselves. With no lockdowns, roadblocks, or restrictions of movement employed, South Korea has managed to slow the growth rate of COVID-19 to the point where active cases are already starting to level off.

 

Some of us have been pounding on the table..."Tests, Tests, and more Tests and follow S Korea as an example". Thankfully some local governments like NY have picked up the tab from failed federal efforts (who botched test kits and prevented a Seattle ID doc from testing in late January/early Feb).

 

A benefit often ignored about testing even asymptomatic/mild cases is that the probability that positive people will take shelter and stay away from elderly/vulnerable increases and the probability of further spread declines. Those people can self quarantine for a few weeks until viral shedding drops off.

[stahleyp]

I personally don't think this will be a Great Depression II. I do think that would be highly likely if we had something like a gold standard though. Since the Fed can print virtually unlimited amounts, I think the chance of GDII is very, very low. I wouldn't be surprised if a 50%+ draw down - especially when you have high valuations as a starting point and fear. The pendulum swings in both directions.

[John Hjorth]

Roche AG Statement [March 13^th 2020] : Roche statement on SARS-CoV-2 and COVID-19.

Conctract Pharma [March 17^th 2020] : Roche Ships First 400,000 COVID-19 Tests.

Roche : cobas® 6800 System.

 

- - - o 0 o - - -

 

Denmark :

 

Finans.dk [March 17^th 2020] : Fast coronatest ready at the end of the week in Denmark.

[minten]

https://www.en24.news/a/2020/03/hydroxychloroquine-would-be-effective-according-to-professor-raoult-of-the-ihu-in-marseille-after-a-first-limited-test.html

 

Bayer and Sanofi seem to have huge supplies of this stuff and seem to have offered donations to whatever country wants it.

 

Too early to tell obviously, but if approved, existing and widely available (combo of) medicines turn out to decrease the severity of the virus (at least for a large number of patients) obviously that would be a quick and complete game-changer.

 

 

[KCLarkin]

Seems they are already widely using these drugs in Italy and elsewhere, so unlikely to be a game changer.

[whiterose]

I live in Hong Kong and have seen the situation developing in China/Asia first hand since January. I'm actually optimistic at this point. We know what works to flatten the curve. Better treatments and medication are getting discovered and at some point, there will be a vaccine. You already see growth in cases stabilize in some Italian regions. Mainland China is getting back to work, albeit slowly. Flights within China are at 60% pre-crisis levels if I remember correctly. Based on their experience it would take a country 3months to gradually recover. My gut feeling says there is FOMO in the (forward-looking) equity markets, in the sense of if the global peak is in sight, doesn't even have to be reached yet, stock prices could suddenly skyrocket higher. It's not like after a war, where the factories are bombed out.

[Castanza]

More infectious that H1N1 (24% global pop with .02% death rate)

 

Less deadly than SARs (15% mortality rate compared to COVID-19 3.4%)

 

Both of the above didn't receive vaccines or treatments for 8-9 months into the outbreak. SARs primarily was treated with antivirals and steroids. The vaccine was only available towards the end of the outbreak that was fizzling out on its own.

 

For the medical experts on this forum. Why shouldn't we expect this to be somewhere in the middle?

 

https://www.healthline.com/health-news/how-deadly-is-the-coronavirus-compared-to-past-outbreaks#So,-when-will-things-calm-down-with-COVID-19?-

[ERICOPOLY]

Once we can test a sufficiently large number of people reasonably often, we can all go about our business again.  This is a logistical and manufacturing problem, because 6 hr tests are available.

 

[Gamecock-YT]

Ackman is on CNBC about to breakdown crying. Very passionate about this.