It is time to start the economy again.

by

I have previously described the COVID 19 virus, which is also referred to as Wuhan virus, to the annoyance of the China friendly US Media. The consequences for the US economy have been severe. The most affected states, New York, California, Illinois and Washington, have virtually shut down their population. Arizona is less affected with 78 positives cases as of today, and no deaths.

Italy and China have had the most deaths. There are a number of factors that probably affect these cases. China is notorious for air pollution and smoking, especially men smoking. There has been a dearth, so far, of listing comorbidities but age has been a major one.

One study lists mortality at age 80+ at 15%. The overall death rate in China was listed at 2.3%, which may reflect smoking and air pollution. South Korea, which has had a big spike as testing progressed much more rapidly than in the US, has a case mortality of less than 1%

South Korea has the dubious distinction of suffering the second-highest number of Covid-19 infections after China but can also boast the lowest death ratio among countries with significant numbers of cases.

According to the WHO on March 6, the crude mortality ratio for Covid-19 that is, the number of reported deaths divided by the number of reported cases is between 3-4%. In Korea, as of March 9, that figure was a mere 0.7%.

AS US testing finally gets going, after the FDA and CDC delayed matters for a month, we will see a big spike in number of cases but, I am convinced, a big drop in mortality rate.

Telephone consulting services, drive-through test centers and thermal cameras which, set up in buildings and public places to detect fever, swiftly came online. South Korea has undertaken approximately 190,000 tests thus far, according to KCDC Deputy Director General Kwon Jun-wook, and has the capacity to undertake 20,000 per day. Turnaround times are six-24 hours.

Tests are highly affordable. “The test kit is about $130, and about half is covered by insurance the other half by individual,” Kwon said. Those who test positive get the test free, “So there is no reason for suspected cases to hide their symptoms,” he said.

We should be doing the same.

At the same time, we are risking severe economic damage to the country by shutting down business activity. I believe that much of the drastic steps taken by governors, especially in New York and California, is unnecessary. High density cities like New York City and Chicago may have more reason to fear spread of the virus. Most of the country, a source of annoyance to left wing politicians, is of low population density.

Another failure of the US response is the absence of masks, which may play a role in limiting transmission in densely populated areas, as in Asia cities. There are reports that China has controlled most of the manufacturing and resists export.

China made half the world’s masks before the coronavirus emerged there, and it has expanded production nearly 12-fold since then. But it has claimed mask factory output for itself. Purchases and donations also brought China a big chunk of the world’s supply from elsewhere.

Now, worries about mask supplies are rising. As the virus’s global spread escalates, governments around the world are restricting exports of protective gear, which experts say could worsen the pandemic.

Also, there is now evidence that treatment of the infected may not require new drugs but be available with known drugs like chloroquine and its analog, hydroxychloroquine

Israeli pharmaceutical company Teva is donating millions of doses of a malaria drug that is believed to be effective in fighting the symptoms of the coronavirus.

The Jerusalem Post reports that the six million doses of hydroxychloroquine sulfate will be shipped to US hospitals started March 31. By the end of next month, 10 million will be shipped.

It is uncertain how effective the malaria treatment will be against coronavirus, but research is currently ongoing.

In fact, there is good evidence that it is effective.

The in vitro antiviral activity of chloroquine has been identified since the late 1960’s (Inglot, 1969; Miller and Lenard, 1981; Shimizu et al., 1972) and the growth of many different viruses can be inhibited in cell culture by both chloroquine and hydroxychloroquine, including the SARS coronavirus (Keyaerts et al., 2004). Some evidence for activity in mice has been found for a variety of viruses, including human coronavirus OC43 (Keyaerts et al., 2009), enterovirus EV-A71 (Tan et al., 2018), Zika virus (Li et al., 2017) and influenza A H5N1 (Yan et al., 2013). However, chloroquine did not prevent influenza infection in a randomized, double-blind, placebo-controlled clinical trial (Paton et al., 2011), and had no effect on dengue-infecteds patient in a randomized controlled trial in Vietnam.

I had speculated that they might be effective in Influenza but this appears to not be the case.

Clinical trials have already shown effectiveness.

According to Sun, patients treated with chloroquine demonstrated a better drop in fever, improvement of lung CT images, and required a shorter time to recover compared to parallel groups.

The percentage of patients with negative viral nucleic acid tests was also higher with the anti-malarial drug.

Chloroquine has so far showed no obvious serious adverse reactions in the more than 100 participants in the trials.

The first case report using remdesivir was dramatic.

The drug is now in clinical trial but the chloroquine evidence reduces the urgency of the study.

What do we do now ?

My wife and I are at high risk but it is easy for us to self isolate. The mortality rate for those under age 50 is about equal to that of influenza. For those between 50 and 70, only those with pre-existing morbidities have a serious risk.

It is time to reopen the economy certainly by next week. The damage done by unemployment and bankruptcy will far exceed that of the disease.

46 thoughts on “It is time to start the economy again.”

  1. 3M has doubled their mask production, and GE Healthcare is going to a multi-shift operation for production of ventilators and other gear. Not sure how much of this is based on firm orders versus on doing the right thing and hoping the orders materialize.

  2. Russia is donating large amounts of test kits and supplies to a range of people including Iran and N Korea. The Cubans are sending both test kits and doctors to a number of places including Italy.

    Both hydroxychloroquine, easier to source, and chloroquine have used by the Chinese and S Koreans for a while now. What it does is allow Zinc into the cells, which shuts down the viruses’ replication. I may have mentioned this quite a while ago.

    You are ramping up to be worse that Italy and in Canada we are finally recognizing that the most infectious stage of the disease is the first 3 days, before any symptoms occur. That took far too long, and although we are still in containment, that won’t last long.

  3. PenGun, the epidemiologist, is still hoping for disaster.

    The “ramping up” is in the numbers of positive tests as testing finally escapes the FDA dungeon. The death rate will decline along the way to about 0.1% for those under 50.

    Fidel’s boy finally, way too late, stopped flights from China.

  5. I agree completely. A lot of the shut downs are signalling combined with bowing to state employees that just want to go home, secure that their pay checks will keep coming regardless.

    When you think about it, a decently run restaurant is probably the last place you need to worry. They may need to lose the table cloths and control seating density but they’re already a lot cleaner than most homes or offices and kept that way.

    I saw a headline on Drudge that Trump was considering closing everything except groceries and drug stores. I didn’t even bother to click on it. He has so far, despite what must be unimaginable provocation, failed to do anything so stupid. He doesn’t have to be told that without the supply chain, those stores would be empty in hours, some in flames.

    I said before that the people that get sick are going to need the rest to take care of them. Unless you are reading this in a converted missile silo with the blast door closed, (and you better hope that the door opens when you want it to) you do to, whether or not you get sick.

    The sort of things that would make it easier and safer for the vulnerable to protect themselves aren’t even particularly expensive. All it would require is some organization. I suspect that a lot of communities are doing this and could use help rather than a shut down that will only make it harder or impossible.

    I’m old enough to be in the higher risk group but lucky not to have other issues. I intend to keep going to work partly because I’m part of the supply chain as well as to support my, mostly much younger, work mates, some of which are supporting family that are at high risk.

  6. So great to hear a commonsense perspective on this thing. Now that China and South Korea have turned the tide on this thing, the (tentative) final numbers are incredibly short of the overblown dooms-day scenarios. Even Italy’s numbers, while still in the thick of things, are not apocalyptic seeing that they lost seven times as many people to the Flu last year.

  7. More information on mortaliuty and on the “asymptomatic” infection status.

    Looking at the US fatality, the fatality rate is drastically declining as the number of cases increases, halving every four or five days. The fatality rate will eventually level off and plateau as the US case-mix becomes apparent.

    and

    On true asymptomatic spread, the data is still unclear but increasingly unlikely. Two studies point to a low infection rate from pre-symptomatic and asymptomatic individuals. One study said 10% of infections come from people who don’t show symptoms, yet. Another WHO study reported 1.2% of confirmed cases were truly asymptomatic. Several studies confirming asymptotic spread have ended up disproven.

  8. In Facebook posts I pleaded that gov’ts figure to issue IOUs to avoid ICUs. Many seem to think that printing money will allow an end run around the Hobson’s Choice of squashing an ecomomy vs elderly dying outside ICUs. All analogous to Mike’s reasoning.

    Saw today (via Realclearpolitics) a two day ago essay that speaks with more detail and more eloquence than I. So I link it below.

    https://thefederalist.com/2020/03/19/will-the-costs-of-a-great-depression-outweigh-the-risks-of-coronavirus/

  9. If there are villains here they would be the Chinese govt and US media. The Chinese govt prioritized the suppression of information about the emerging epidemic over suppression of the epidemic itself, and now is conducting a propaganda campaign to shift blame for the epidemic to the USA. The US media have fomented panic for partisan and business reasons, stampeding national pols to support terrible legislation and local pols to decree mass-lockdowns that exacerbate the devastation of entire industries. The “worst since 2008” comparison will only stick if the Trump administration takes the bait, like Obama, and uses a crisis as a tool to increase its control over the private economy. Probably this won’t happen, but one sees how it easily could if Trump loses his nerve. The country left to its own devices, ideally with deregulatory measures that are allowed to become permanent, could bounce back quickly.

  10. Mike, you are a treasure. Information from a good number cruncher, is your go to. ;)

    There is a great deal of information available, and why America is ignoring a great deal of it, is puzzling. The Italian medical system is a very good one, unlike yours, and your numbers are a complete mystery at the moment. You have no idea how many are dying from this disease and how many are infected, no idea at all, as you have not tested many people. I suspect you may be the largest country in this state, and probably you will teach us all how bad it can be.

    Denial is not just a river in Egypt.

  12. Another useful source of information.

    “If you have a COVID-19 patient in your household, your risk of developing the infection is about 10%”¦.If you were casually exposed to the virus in the workplace (e.g., you were not locked up in conference room for six hours with someone who was infected [like a hospital]), your chance of infection is about 0.5%”

    A growing body of evidence indicates that COVID-19 transmission is facilitated in confined settings; for example, a large cluster (634 confirmed cases) of COVID-19 secondary infections occurred aboard a cruise ship in Japan, representing about one fifth of the persons aboard who were tested for the virus. This finding indicates the high transmissibility of COVID-19 in enclosed spaces

    The results of their research show that COVID-19 doesn’t spread as easily as we first thought or the media had us believe (remember people abandoned their dogs out of fear of getting infected). According to their report if you come in contact with someone who tests positive for COVID-19 you have a 1–5% chance of catching it as well. The variability is large because the infection is based on the type of contact and how long.

    PenGun, the “great number cruncher,” thinks testing is the same as dying.

    Pardon me if I ignore you.

  13. As I watch state level data, New York is in a word of hurt and probably does need a full lock down to prevent person-to-person transmission and community spread. Illinois and California are a bit of a puzzle though they do have the capacity to get as bad as New York. Somebody evidently got to our governor here in Kentucky, or he’s smarter than the average Democrat, because though I heard rumors of a lock down he seems to have backed off to just continued school closures.

  14. The economy should never have been shut down — thank you, panic-mongering media. Although we probably also have to blame a generation of “educators” who left citizens unable to distinguish 22,000 flu deaths this season (with no panic) from 200 deaths ascribed to another virus (panic! panic! panic!).

    Nevertheless, the domestic economy has been severely curtailed for no good reason, which will cause lingering problems of bankruptcies and unemployment. But there is another negative impact on the economy which is getting closer every day — the disruption in the supply chain from China, on which we have become very dependent. Because of the multi-week time delay between the factory in China restarting production and the newly manufactured good reaching the store or factory in the US, we have not yet begun to feel the full impact of the China shutdown. And as China restarts its manufacturing, its first priority — quite properly — will be restocking its own domestic needs. The US and the rest of the West will have to wait.

    In theory, this incident could stimulate businesses to re-shore production formerly moved to China. When someone tries to fight his way through 3 years worth of bureaucracy just to get permission to break ground on building a new factory, he will probably remember that avoiding an unbearable regulatory burden was a large part of moving the factory to China in the first place.

  15. I think this assessment is too pessimistic.

    All that aside: It is very clear that capacity expansion has to be the priority now. It has not seriously been addressed by any government as near as I can tell. Moreover, let’s face it, it will take some time. China impressively did this in a couple of weeks. That will be hard to beat. However, what would Italy have given to have started doing this a couple of weeks ago?

    A War Footing
    Building out that capacity requires a new mindset and it requires it quickly. The great news is that we ”” and by we I mean the generation who were adults in World War II ”” have done this before. Entire economies were shifted over to military production. This was done by abandoning market processes of resource allocation and moving to a planned economy. This time around it will be directed towards temporarily and dramatically expanding the capacity of the health care system. The good news is that our military has been doing this too. Perhaps not at this scale but there is critical knowledge and understanding there.

    I think the hospital/respirator thing is overblown. I think the drugs, including chloroquine and hydroxychloroquines, which is safer, will reduce the hospital bed need.

    Remdesivir, if it successfully evaluated, should end the respirator shortage. The people who have required respirators are mostly elderly or with lung pathology.

    I would not be unhappy to see some of the obsession with “Certificates of Need” reduced but I think we will have enough capacity.

  17. }}} There has been a dearth, so far, of listing comorbidities but age has been a major one.

    I had a link, sorry, did not keep it, which had China listing some of these factors. It’s China, so take that with a grain of salt, but I saw little political benefit in lying about the numbers:

    Apparently in the major affected areas, the fatality rate among those 55 and under was 0.3% — not much worse than a nasty flu.
    Among the elderly was the biggest concern: There were estimates that the fatality rate for those over 65 was as high as 15%.

    There’s a dark humor joke floating around that this is “The Boomer Doomer”, since boomers are the most likely to suffer death from it.

    This also makes sense in regards to Italy, since Italy is the second largest percentage “elderly” nation in the world, second only to Japan, which offers an interesting track for investigation…

    1) Is Japan hiding its numbers?
    2) Assuming the answer to “1” is “No”, then what did Japan do RIGHT than Italy did wrong? Or is it some simple “bad luck” for Italy?

  18. “Pay attention to the number crunchers!!”
    – PenGun

    Yeah, how about a Standford epidemiologist who is co-director of its Meta-Research Innovation Center?

    Stanford epidemiologist warns that coronavirus crackdown is based on bad data
    https://www.thecollegefix.com/stanford-epidemiologist-warns-that-coronavirus-crackdown-is-based-on-bad-data/

    Or an Israli virologist?

    Israeli virologist urges world leaders to calm public, slams ‘unnecessary panic’
    https://www.timesofisrael.com/israeli-virologist-urges-world-leaders-to-calm-public-slams-unnecessary-panic/

    This also jibes with the opinion of a professional epidemiologist of persona acquaintance, who works at UF…
    “People panicking over this are idiots”, or very close to same.

    I’m sticking with the real evidence:
    Older people should be fairly cautious, and very aggressive in seeking treatment if they do show symptoms. For anyone else, this is a very bad flu. Use common sense.

  19. More evidence that we are over reacting.

    I don’t think the U.S. will experience a mortality rate anywhere near as high as Italy’s, for a number of reasons including our younger population, far fewer smokers, lower population density, a better health care system and early deployment of anti-viral drugs, some of which are likely to prove helpful. But let’s assume the U.S. ultimately sees a mortality rate of 100 per million. That would be 143 times the current U.S. rate, not outside the realm of possibility. Do the math: if we have around 330 million people, and 100 die per million, that equals 33,000, which would be equivalent to the deaths from an average seasonal flu season. Maybe it’s worse than that; maybe by the time it runs its course, the death toll from COVID-19 rises to 200 per million, 286 times the current rate. That would still be less than the death toll from flu in the U.S. just two years ago.

  20. From the alarmist assessment which Mike K quoted above:
    “Entire economies were shifted over to military production. This was done by abandoning market processes of resource allocation and moving to a planned economy. This time around it will be directed towards temporarily and dramatically expanding the capacity of the health care system.”

    Hmmm. That system might better be described as a Dictatorship rather than a Planned Economy. The fun part of doing what that alarmist wants would be when the Dictator decides to erect an emergency camp for virus victims in the Hamptons, and a second one in Malibu. When all the usual Leftie NIMBYs rush out to protest, they would be arrested and shipped off to dig the needed mass grave in North Dakota along the Canadian border. No trials necessary, and any lawyer who whispered Habeas Corpus would find herself standing next to her client with a shovel in her hands.

    The lesson we should be learning is — Junk Science Kills!

  21. Any discussion of restarting the economy needs to consider the profound effects of two trillion dollars of additional debt in a very short time with the Fed buying billions of dollars of treasuries. A massive aggregate demand stimulus with an aggregate supply contraction sets up a classic inflationary spiral and crowding out of business investment. This is likely to influence rational expectations of businesses and households toward actions to protect from the virus of inflation and little real economic growth. Think Jimmy Carter economics. Reaganomics is a painful long run cure for such a scenario and might be politically infeasible in today’s circumstances.

    The knee-jerk (sorry for reference to the progressives) reaction is calls for the government to “do something” to make all pain to go away, right now. Well, that doesn’t bode well for restoring a vibrant economy such as we had going. The political class will pursue control and regulation at every bump in the road. The emergency interventions over the China virus will only reinforce the first responder status of the government to economic scenarios that will be largely be the result of their well intended actions that have destabilized the economy. Allowing market mechanisms to re-establish the conditions for growth and efficiency are highly unlikely.

    Reining in the counter productive actions of the government in trying to manage the economy is unlikely to come from the public. They still think creating massive government debt is a viable method for the “government” to make their wants come true and reduce their pain. What incentive will they ever have to have an emergency fund of three months take home income for things like this if the their sugar daddy government sends them two thousand dollars of funny money every time somebody says the sky is falling? Nope, need a new SUV ’cause the current one is about to come off flease. Need a 65-inch TV minimum or the kids will refuse to watch at home. This year’s vacation needs to be bigger and grander than ever, what’s several thousand dollars? Seriously, what kind of unicorn fantasy we want to live in where saving for things and having an emergency fund is not in the equation. Why would we think the government should act any more responsible?

    Death6

  22. You do understand that we are going to see how this progresses? Well most of us. The problem you are ignoring is that a large number of carriers do not have symptoms. The epidemic will spread widely, as about every 6 days the numbers of disease carriers will double. That’s normal for an epidemic like this.

    Why various people claim its going to be fine, is a bit puzzling, as pretty well all the evidence denies that.

  23. Wow. From your Israeli expert: “but the virus is not airborne”. This is just flat out wrong! The virus can hang in the air for quit a long time. Why do I know more about this than Mike K and, it appears many experts? My motto, “Run And Find Out”, may have something to do with it. ;)

  24. Pengun: “a large number of carriers do not have symptoms”

    Great! A large number of people can carry this virus around in their systems, along with innumerable other viruses and microbes, and they stay healthy and productive.

    This is Darwin in action. Those people on whom this virus has no effect will reproduce, the others not so much. In a few generations, everyone will carry the virus around as they live full & satisfying lives.

    Admittedly, Darwin is not so much fun for the other people — but hey! we don’t make the rules, and only the fittest survive. Those other people had better start hoping that this virus panic is unwarranted.

  25. As with nearly all human problems, stupidity is the biggest killer. The carriers without symptoms, some because the disease is in an early stage, and some who will not show symptoms, are the ones freely infecting everyone around them. The biggest problem this particular virus presents, is that shedding occurs almost immediately, into the throat, where it is pushed out into the environment to infect new carriers. That occurs fairly massively for the first 3 days, before there are symptoms. As we know that, in a community infection like this your infected will double every 6 days.

    This is why its running away in so many countries. You are … not dealing with this well and many people will die.

    Both the Cubans and Russians are helping out in Italy now. The Russians sent 100 doctors and 5 or 6 planes full of supplies. We are looking at the supreme irony of them probably needing to help you too.

  27. The question that nobody is asking about the bail-outs is will it even make a difference? How many of the home “owners” in 2008-9 that were bailed out kept their home? Damned few as I remember.

    Right now, the only industries that have suffered probably irreparable damage are the airlines and cruise ship companies. Maybe the best answer for them is bankruptcy. I suspect it will be years if ever before anyone will step on a cruise ship without thinking. Do we taxpayers really want to pay to lay up these billion dollar piles until people are willing to sail on them? If there’s a market, let them convince investors to invest like a free market is supposed to work. If your business can’t survive a couple of weeks disruption it probably wasn’t much of a business to start with.

    Who will pay for this new economy redirected to health care? There aren’t that many rich Arabs.(and fewer every day) And who would it benefit? Not anybody that needs a ventilator this year.

    If there was ever a time that shows the folly of entrusting the country to a bunch glib parasites that never produced anything of actual value in their lives, now is it. The Democrats are about to nominate a master blood sucker.

  28. “And the Russians are the only ones helping, right?”

    No. Jack Ma the creator of Ali Baba has donated 1 million masks and 1/2 million test kits to America. Russia has sent aid to a number of countries, including Iran and N Korea. Cuba as they have for a long time, sends doctors all over the place, its nothing new for them.

  29. Why donate to North Korea, they havre no problem, right? Everything under control so to speak.

    So we got Jack Ma, Russia and Cuba. Could we be selectively picking donor countries? No, not you.

    Death6

  30. Hardly worth a response but hey. You tell me who is donating to other countries during this pandemic, if you don’t like the ones I have noticed. Your country could take your foot off the neck of several countries during this, but no, sanctions will continue on Iran etc etc.

    Karma is an absolute bitch. You don’t want to play this stupid game now.

  32. Of course forgetting that the U.S is consistently in the forefront, donating material and expertise as well as, more often than not, transportation for the donations of others. Trump has offered assistance to N. Korea as well.

    We’re still not going to give them a pass on developing nuclear weapons and passing it on to the genocidal regime of Iran. We also shipped supplies to China to support their fight.

    We have always differentiated between the governments we would wish to destroy and the people suffering under them. Look up how much food aid we sent to the Soviet Union over many years.

    What the champions of Cuba never explain is why the streets aren’t filled with cars from Europe and Asia that never embargoed anything at all. Or how Castro became a billionaire.

    Saw an article about someone in B.C. that bought out the entire meat section of a supermarket. He’s now getting death threats, eh?

    If Canada does manage to dodge this it will be a case of luck trumping skill considering the large number of Chinese in the West and the generally decrepit condition of the health care system there. I wish them luck.

  33. Mike the disaster is in progress. I have no need to hope for anything, but I sure hope you act quickly so less of your people will die. As you are still dragging your heels I expect a worse outcome that Italy in your country.

    In Canada we are still theoretically in containment, we are in a much better position than you are. Still that’s not real, and we will suffer to the extent that we do not take lessons from the Chinese, who do know how to defeat this.

    Attacking each other at a time like this is what will make everything worse.

  34. Trump. The gift that keeps on giving. He is going to stop all this isolation to save the economy. Its gonna be 15 days before he looks at it again. Your people will not forgive you, after the rest of the world recovers, and you are still in the weeds.

    Its a test of your system, and I expect you to fail.

  35. Trump thinks the mortality rate is low. Sophisticated analysis of the numbers reveal about 5.7% death rate, which should horrify everyone.

  36. “Sophisticated analysis of the numbers reveal about 5.7% death rate”

    5.7% of what? The total population? The minority of the population which tests positive for the virus, even though most of them have no or minimal symptoms? The much smaller minority who require hospitalization? The much much smaller minority who require Intensive Care?

    The percentage is meaningless without defining what is the denominator.

    The denominator which matters is the total population, most of whom are never going to catch the virus. The death rate among the total population will be 0.2% or less, possibly much less.

    We should all be prudent. We should all also avoid alarmism.

  37. I get the impression that a lot of people require a million of their fellow citizens to die before acknowledging the seriousness of the situation.

  38. The Chinese claim to have won. They also claim that they haven’t imprisoned more than a million people because they didn’t like the way they looked. They claim that they don’t execute people in operating rooms so that they can sell their organs. They make a lot of claims for credulous fools to parrot in the West.

    I read an article that claimed that there are suddenly 21 million fewer cell phones operating in China than a couple of months ago. Sounds like a strange sort of winning.

  39. I give up. I have done my level best to freak you out as you are not catching on. After being deleted by Dan, I have decided you richly deserve what’s coming, and will just watch the horror show. Good luck to all of you.

  42. I know I shouldn’t, but how is anything served by “freaking” us out? Whatever happens is pretty much beyond the control of anyone here outside of personal choices. You seem to be the only one freaked out, but everything in Canada is going so swimmingly.

  43. I have decided you richly deserve what’s coming, and will just watch the horror show

    When you say no to a panhandler and he starts cursing at you…

    —

    I get the impression that a lot of people require a million of their fellow citizens to die before acknowledging the seriousness of the situation.

    troll

    —

    I heard for real that smoking grass actually repairs the damage from cigarettes.

    Dude!

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