Based on simple calculation, with over 13k new daily Coronavirus infected cases, US will overtake Italy in 1-2 days as No 2, then in 2-3 days will overtake China as No 1 for # infected cases (based on reported data, not actual happened). Italy has shown declining number of new daily infected cases over the past 5 days.
It means the Top 3 ranking of Coronavirus would change in position in about 3 days from:
1) China, 2) Italy, 3) US
To
1) US, 2) Italy, 3) China
In fact, based on # death cases (more reliable comparison as it is easy not to report mild infected cases but difficult to ignore death cases even happened at home), true ranking should be:
1) Italy, 2) Spain, 3) China, 4) Iran, 5) France, 6) USA
Reason is there are many mild cases not reported in Europe (limited medical resources).
In Europe / Iran, fatality rate of 8-10% is much higher than norm of 1-5%, not aligned with China (5%, which is already high) and Singapore / Germany (0.5%, both countries considered golden standard as most cases are detected and treated with top medical services). So, actual fatality could be around 1% (assuming full detection but average medical services), therefore actual cases in Europe / Iran should be 10 times higher than actual. So, the actual fatality should be close to 0.5 – 1% if most infected cases are considered (including those without symptoms).
US has about 1000 death cases from Coronavirus, assuming 10x more to 10,000 cases, still 10X lower than common flu (eg H1N1) which results in over 100,000 death in US yearly.
So, it is not the deadly virus which causes the crisis. It is the fear of unknown virus which immobilize the movement of people, causing loss in jobs and income, therefore falling in stock market and economy.
So, the root of the crisis is fear, which needs to wait for # new daily cases to decline over the next 1-2 months in the world (India started later, may end later), only then the crisis may be over. Even if Coronavirus is back in next winter in Dec 2020, strain likely will be lower, could be another H1N1-like of long term virus with mankind.
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Trump knows market greed vs fear very well. Therefore, unlimited QE is introduced. In fact, the highest level of QE is no need to spend 1 cent, just an announcement to restore the confidence but actual money may take months, eventually the fear of crisis could end in summer before actual QE money is printed.
Therefore, in the past, the Fed Chairman has to think twice in wordings after each FOMC meeting, especially during Alan Greenspan time, few people understands, therefore stock market has to guess his mind. From Ben Bernanke to Janet Yellen to Jerome Powell, it is more transparent and predictable.
Global stock market is similar to Coronavirus, fact or illusion is not critical. Most important is the perception which instantly affect the emotions, greed or fear, the winner would drive the stock market up or down.
Since the source of all “evils” are fear of Coronavirus started in Jan 2020, then the crisis could only end when the Coronavirus die down around summer (解铃还须系铃人、心病还得心药医). Jan-Jun 2020 will be a record in human history, 6 months of mass vacation for most people at home, spending more time with family which was a luxury last time.
If the market fear of Coronavirus disappear in coming summer, then global stock market would have good chance to recover, with condition that current global QE must provide quick short term help in next few months to both business and individual through direct money allocation (similar to blood transfusion to a weak patient), or literary “throwing money from helicopter” to everyone to manage the short term fear to sustain the economy, until the real evil of fear, Coronavirus is away for its summer vacation.
If it is flash stock market crash (falling in Mar-Apr 2020, then gradually recover by summer), this could be a record of fastest fear and quickest greed in human investment market history. If not, then the short term fear would bring along a long term pain of global financial crisis to the world. So, summer is critical.
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