03-03-2020, 04:50 PM
I think SPY 260 is likely. I think SPY 203 is within the realm of possibility (would be a 40% drawdown from the highs, based off of Scott Minerd's Bloomberg interview last week).
Unless the known pathogenic/epidemiological characteristics of the virus and our domestic mitigation efforts in the U.S. (pitiful to date) change drastically, I think we are looking at a nationwide healthcare situation similar to Hubei Province within 30 days. The statistical outcomes predicted for such an event would dwarf any similar event in modern U.S. history. Likely more than 2 million deaths in the U.S. alone (~58,000 Americans died in Vietnam, and ~400,000 died in WWII). It is not the end of the world, but the social and economic consequences will exact a heavy toll.
My math on the 2+ million deaths is derived in part from Professor Marc Lipsitch's latest estimate of population infected. He is an epidemiologist, and Director of the Center for Communicable Disease Dynamics at Harvard's T.H. Chan School of Public Health (considered the best in the world). He recently updated his assumptions using the latest available data, and estimates a range of 20-60% of population infected (Dr. Gabriel Leung of Hong Kong University has estimated as high as 60-80%, but I'll work with the lower numbers here). WHO's latest estimate for case fatality rate (issued today) is 3.4%. Go with the lower bound of infection rate. 330,000,000 Americans x 20% x 3.4% = 2.24 million. The numbers for people requiring ICU treatment and hospitalization for pneumonia are multiples of that, and there are not enough hospital beds or healthcare workers in the U.S. to handle that burden. Healthcare workers are also at highest risk for infection, and once infected and quarantined they are removed from the pool of available treaters for several weeks, at a minimum.
Even if the U.S. switches to extreme mitigation measures like China did, I think the very nature of those mitigation measures (extreme quarantine and transport shutdowns) would create a severe shock to the economy.
This is not the apocalypse. The U.S. and world are not going to go Mad Max and fall apart, but the latest available data indicate that societal and economic consequences of an event like this are likely to be extreme.
Unless the known pathogenic/epidemiological characteristics of the virus and our domestic mitigation efforts in the U.S. (pitiful to date) change drastically, I think we are looking at a nationwide healthcare situation similar to Hubei Province within 30 days. The statistical outcomes predicted for such an event would dwarf any similar event in modern U.S. history. Likely more than 2 million deaths in the U.S. alone (~58,000 Americans died in Vietnam, and ~400,000 died in WWII). It is not the end of the world, but the social and economic consequences will exact a heavy toll.
My math on the 2+ million deaths is derived in part from Professor Marc Lipsitch's latest estimate of population infected. He is an epidemiologist, and Director of the Center for Communicable Disease Dynamics at Harvard's T.H. Chan School of Public Health (considered the best in the world). He recently updated his assumptions using the latest available data, and estimates a range of 20-60% of population infected (Dr. Gabriel Leung of Hong Kong University has estimated as high as 60-80%, but I'll work with the lower numbers here). WHO's latest estimate for case fatality rate (issued today) is 3.4%. Go with the lower bound of infection rate. 330,000,000 Americans x 20% x 3.4% = 2.24 million. The numbers for people requiring ICU treatment and hospitalization for pneumonia are multiples of that, and there are not enough hospital beds or healthcare workers in the U.S. to handle that burden. Healthcare workers are also at highest risk for infection, and once infected and quarantined they are removed from the pool of available treaters for several weeks, at a minimum.
Even if the U.S. switches to extreme mitigation measures like China did, I think the very nature of those mitigation measures (extreme quarantine and transport shutdowns) would create a severe shock to the economy.
This is not the apocalypse. The U.S. and world are not going to go Mad Max and fall apart, but the latest available data indicate that societal and economic consequences of an event like this are likely to be extreme.