Economic implications of a SARS/Coronavirus outbreak

[IFocus]

This covers a lot of ground raising very uncomfortable truths but for those that think about the future of the US and how it got to here its very good read with plenty of numbers.

Below is just a insight comparing Canada to the US re covid response.


"Over the last months, a quip has circulated on the internet suggesting that to live in Canada today is like owning an apartment above a meth lab. Canada is no perfect place, but it has handled the COVID crisis well, notably in British Columbia, where I live. Vancouver is just three hours by road north of Seattle, where the U.S. outbreak began. Half of Vancouver’s population is Asian, and typically dozens of flights arrive each day from China and East Asia. Logically, it should have been hit very hard, but the health care system performed exceedingly well. Throughout the crisis, testing rates across Canada have been consistently five times that of the U.S. On a per capita basis, Canada has suffered half the morbidity and mortality. For every person who has died in British Columbia, 44 have perished in Massachusetts, a state with a comparable population that has reported more COVID cases than all of Canada. As of July 30th, even as rates of COVID infection and death soared across much of the United States, with 59,629 new cases reported on that day alone, hospitals in British Columbia registered a total of just five COVID patients."

The Unraveling of America
Anthropologist Wade Davis on how COVID-19 signals the end of the American era


https://www.rollingstone.com/politi...I2U3PO75Jd_rZJ_1AAFfsIAu93TnQfmrNKFu5xWJo7Ahc

 

[wabullfrog]

Bullsh---t. Try 10-50% of the population has been exposed and >10% has been infected but asymptomatic

The >10% has been infected, is that for USA or Australia?

 

[qldfrog]

I personally wouldn't take it that far (though of course you have every right to) but my underlying concern, the "big" one, is this really.

If I skydive, ski, ride horses, ride motorbikes or whatever well again there are risks in that something could go wrong which injures or kills me. Known risks which I can choose to take or not take.

If I fail to exercise, eat too much sugar, smoke or whatever well then there are known consequences from that from a statistical perspective. Further, I can choose to exercise or not exercise, smoke or not smoke, and sugar is at least largely avoidable if one chooses to avoid it. We can scale that up to 1000, 10,000, 1 million or however many people and say that if they all smoke regularly or don't exercise or whatever then x number of them will die because of that and y will suffer a non-death but significant health consequence and z will avoid meaningful impacts.

Now the problem with COVID-19 is that nobody seems willing to answer the question. If 1 million people are all infected then what happens?

How many die in the short term?

How many die in the longer term?

How many suffer a non-death health impact? Of those, what are the impacts and when do they occur?

There's the big problem, it's an unknown. A "let it rip" approach might end up killing a hundred unfortunate people and beyond that really just knocks people out of their misery who were going to die anyway. It's the equivalent of two buses running into each other and killing everyone on board.

Or it might be signing us up for another $100 billion in health care costs plus double that in other costs for years to come as it brings whatever debilitating impact to the population.

It would be a real tragedy if for example it turns out that (using hypothetical but not impossible examples) we need to ensure any woman who's had it never has a child otherwise it'll be badly impacted. Or if it turns out that it knocks 20+ years off average life expectancy. Or whatever.

Now those are purely hypothetical examples and it could well be that there's nothing to worry about. There's the problem - if someone could properly answer that question, as to exactly what the impacts are, well then a far more sensible discussion becomes straightforward.

Until that time though it's basically gambling. It's akin to discussing buying shares in whatever company but all we have is a price chart which goes back 6 months with a disclaimer on it that volume data only includes a random selection of trades and is this totally inaccurate. We have no useful fundamental information about the company, we don't know who any of the directors are indeed we don't even know if it has an actual business or it's just a wannabe. We are however considering forcing most of the population, business and government to put literally all of their assets into this venture. That could end either brilliantly or in catastrophic disaster.

If the facts were known then, depending on what they turn out to be, I may well jump to the "let it rip" view. Doing so without knowing the implications would however be one hell of a gamble from which there's no going back.

That said, I don't doubt that the economic aspects are also becoming a disaster. On that front I'll observe that how it ends up has something in common with WW2. If we go down the "Germany" track and start over with new industries and so on then ultimately we'll emerge stronger because of this despite a major setback in the short term. If we go down the "UK" track and try and prop up what were already tired old business models into the future then we're in for a world of pain for a long time to come.

Covid is not exactly a brand new extra terrestrial virus, just the latest of many corona viruses; it is not 100% sure, but you can take a fair bet that overall it will behave like the others, which means: mostly harmless if you recover..but not fully: even flu can destroy you well past the initial infection;
relatively low death rate..obviously always too high but we are talking 1 percent , not 40 or 60%, highly contagious and wo effective vaccine in sight with mutation expected and ending up as a seasonal virus .
And to scare people : it is not and will not be the first corona virus to surface...
In the same way that you are not 100% sure you will brake after pressing on the brake pedal, you assume it will because that is by far the highest probability: seen that, done that..so is this virus;
It is not impossible but highly improbable that it will behave differently from its cousins
In a twisted way, I think it is far less dangerous than any avian virus which could jump to human and stay efficient there, and this is just a waiting game for that one.Not impressed with that COVID precedent for any future real disastrous epidemy;
Your last point is interesting about the new industry vs rebuild old; valid point indeed, if this is what that Reset/scam/emergency is all about?
In Europe, suppression of fossil fuel and prohibition of transport is an advertised aim in the post covid
no plane car and even train transport reduced
.

 

[Smurf1976]

Your last point is interesting about the new industry vs rebuild old; valid point indeed, if this is what that Reset/scam/emergency is all about?

Regardless of the arguments for or against the severity of the virus, lockdowns etc I can definitely see an advantage being gained by those countries or regions within countries which correctly identify the future and grab it rather than trying to revive something that's going to struggle at best.

If we go back almost 30 years to the last recession then the "correct" approach was to embrace a future which was very different to the past prior to that time.

A smart move then was ditch anything relating to manufacturing, conglomerates, media, anything formal and so on and instead embrace services, outsourcing, IT and anything casual.

We can see differences there even within Australia. Eg Adelaide and Perth were virtually identical on most measures 30 years ago but one with its reliance on manufacturing has struggled relative to the other in a resources-driven economy. That's not a prediction for the future, if manufacturing revives then the reverse may well be true, but it's an observation of what happened last time.

If an industry has run aground due to COVID-19 and isn't going to do well in the new era then instead of pouring a fortune into trying to prop up a dead concept it would be far better to invest in something that's going to be a growing thing in the future.

It's like an old car really. If it's roadworthy and runs then continuing to drive it is one thing but if it gets damaged well then spending serious $ repairing it doesn't make sense.

 

[SirRumpole]

If we go down the "Germany" track and start over with new industries and so on then ultimately we'll emerge stronger because of this despite a major setback in the short term.

Yes , Germany and Japan started again with the resources of the UK and the US among others where less generous victors would have been owning their productive resources and using the income to build up their own industrial base. But I guess the US got a few rocket scientists so that's ok.

However, that's water under the bridge but the lesson is pretty clear, use the crisis to redevelop our own capacity and strengthen our supply chains and not rely as heavily on others for basic needs. What will be interesting is that if a vaccine is developed will the big pharma companies "share" it around or wring as much profits out of it as they can ? That will give an indication as to how much we can rely on others in times of need. I suspect that if the US controls any vaccine then under Trump at least they will profiteer, probably the same in the UK and the fact that Morrison is pretty well pleading for caring and sharing indicates that we are sadly deficient in our abilities to be a large scale vaccine producer.

 

[qldfrog]

Regardless of the arguments for or against the severity of the virus, lockdowns etc I can definitely see an advantage being gained by those countries or regions within countries which correctly identify the future and grab it rather than trying to revive something that's going to struggle at best.

If we go back almost 30 years to the last recession then the "correct" approach was to embrace a future which was very different to the past prior to that time.

A smart move then was ditch anything relating to manufacturing, conglomerates, media, anything formal and so on and instead embrace services, outsourcing, IT and anything casual.

We can see differences there even within Australia. Eg Adelaide and Perth were virtually identical on most measures 30 years ago but one with its reliance on manufacturing has struggled relative to the other in a resources-driven economy. That's not a prediction for the future, if manufacturing revives then the reverse may well be true, but it's an observation of what happened last time.

If an industry has run aground due to COVID-19 and isn't going to do well in the new era then instead of pouring a fortune into trying to prop up a dead concept it would be far better to invest in something that's going to be a growing thing in the future.

It's like an old car really. If it's roadworthy and runs then continuing to drive it is one thing but if it gets damaged well then spending serious $ repairing it doesn't make sense.

Agree it is a shame the last PM to try this faced a push back from both own party and the voters
Whatever you think of Malcolm,its reform and economic agenda pushing for entrepreneurship and startuo was smeared
The same party is still in power and if it was just the person,well the focus could have ben kept
This country has a fundamental issue with success.so does not want to sée entrepreneurs he a great bloke with an apprentice, a bastard boss if he has more than 5 or drive a car worth more than twice the average ute.
This would have to change and i do not see this happening with a Universal Income as we de facto have

 

[qldfrog]

But a real crisis could make it.
In a disguise,this virus mismanagement could be our chance
Bring us to the ground to rebuilt before we get economically and mentally too weak for rebirth

 

[Junior]

Are the NT completely killing off tourism for at least the next year and a half? Why would he put such a long time-frame on it, when there are so many unknowns? Imagine being a tourism operator in NT. This is extremely draconian.

https://www.news.com.au/travel/trav...s/news-story/d280966f5230a77181525f1b59987ffc

 

[Dona Ferentes]

and for something more cheery:

The Next Global Depression Is Coming and Optimism Won’t Slow It Down

https://time.com/5876606/economic-depression-coronavirus/

 

[qldfrog]

and for something more cheery:

The Next Global Depression Is Coming and Optimism Won’t Slow It Down

https://time.com/5876606/economic-depression-coronavirus/

A great boost for the day DF :-(

 

[Dona Ferentes]

you are welcome

 

[basilio]

How many of the millions of people currently working from home will ever get back to their office ?
How many will keep their jobs even if COVID settles down ?

This links backs to Dona's article on the risks of a global depression arising from COVID. (That was an excellent article.)

Coronavirus work from home might become work done overseas
Forced away from city centres to slow the spread of coronavirus, the work-from-home revolution has shown many jobs can be done from the suburbs as easily as they were in humming office buildings housing thousands of workers.

Key points:

Key points:

• Business process outsourcing (BPO) is where parts of a company's core operations are outsourced to third-party providers
• Economists warn that many businesses will realise they can operate with fewer workers or perhaps cheaper workers located overseas
• However, some companies are onshoring rather than offshoring during the COVID-19 crisis, with Westpac bringing back 1,000 call centre jobs from overseas

Could the shift be the change that regional Australia has long waited for? Or does it mark the moment Australians have to compete in the global market for jobs, with equally qualified but much cheaper workers?
https://www.abc.net.au/news/2020-08-11/covid-work-from-home-might-become-work-done-overseas/12542354

 

[satanoperca]

Basilio,
Lets look at it reasonably, working from home you require :

• A chair and desk, no doubt made in China
• A screen and computer - made in China or South Korea
• Software - maybe the US, windows or OS
• Business software - gsuite or microsoft - Offshore again.
• An internet connect - finally something rather local
• Search engines - mainly Google

Now lets look at what type of work that can be done in regional Australia or suburbs:

• Admin work - offshore to the Philippines - matches closely with our time zone and english speaking
• Graphic Design - little harder as it requires creativity, by try Mexico, Italy, Germany, US
• Software Development - take your pick of countries that this can be done in.
• VA/PA - again plenty of countries to work with, I prefer the Philipines myself
• Engineering - soviet states, Russia, Ukraine
• Architecture/drafting - architecture
• IT support - take your pick again
• Ecommerce marketing, Paid (PPC) and SEO (onpage and offpage) - again there are several countries that can do this for less than Australian's.
• Accountancy - my pick is Malaysia for various reason
• Communication tools - Skype, Hangouts, Zoom - ah again overseas companies

One that only developers use : JIRA, Australian company, all payments made to overseas bank accounts.

So where I am coming from, anything that can be done at home in Australia can just as easily be done overseas.

The only reason why bosses have not always chosen to offshore services, is their lack of willingness and skills to manage remote teams, BUT this is going to change due to the shut downs.

Why do I say all of this, as I live it.

1. Backend development team in Hanoi- Vietnam
2. Frontend development team in Ho Chi Minh City - Vietnam
3. UI/UX design team in Ho Chi Minh City
4. Support team for word press and ecommerce platforms - Bangladesh
5. Virtual Assistant - Philippines
6. Off Page SEO employees (2) - Philiphines
7. Graphic Design team - India

Where do I need to work/physically - anywhere, just need my trusty laptop and an internet connection.

This has been going on for years, but the change/trend is going to increase significantly in Australia due to the virus.

 

[wayneL]

Basilio,
Lets look at it reasonably, working from home you require :

• A chair and desk, no doubt made in China
• A screen and computer - made in China or South Korea
• Software - maybe the US, windows or OS
• Business software - gsuite or microsoft - Offshore again.
• An internet connect - finally something rather local
• Search engines - mainly Google

Now lets look at what type of work that can be done in regional Australia or suburbs:

• Admin work - offshore to the Philippines - matches closely with our time zone and english speaking
• Graphic Design - little harder as it requires creativity, by try Mexico, Italy, Germany, US
• Software Development - take your pick of countries that this can be done in.
• VA/PA - again plenty of countries to work with, I prefer the Philipines myself
• Engineering - soviet states, Russia, Ukraine
• Architecture/drafting - architecture
• IT support - take your pick again
• Ecommerce marketing, Paid (PPC) and SEO (onpage and offpage) - again there are several countries that can do this for less than Australian's.
• Accountancy - my pick is Malaysia for various reason
• Communication tools - Skype, Hangouts, Zoom - ah again overseas companies

One that only developers use : JIRA, Australian company, all payments made to overseas bank accounts.

So where I am coming from, anything that can be done at home in Australia can just as easily be done overseas.

The only reason why bosses have not always chosen to offshore services, is their lack of willingness and skills to manage remote teams, BUT this is going to change due to the shut downs.

Why do I say all of this, as I live it.

1. Backend development team in Hanoi- Vietnam
2. Frontend development team in Ho Chi Minh City - Vietnam
3. UI/UX design team in Ho Chi Minh City
4. Support team for word press and ecommerce platforms - Bangladesh
5. Virtual Assistant - Philippines
6. Off Page SEO employees (2) - Philiphines
7. Graphic Design team - India

Where do I need to work/physically - anywhere, just need my trusty laptop and an internet connection.

This has been going on for years, but the change/trend is going to increase significantly in Australia due to the virus.

Paul Keating will eventually become canonized as prophet... Banana Republic, indeed.

 

[over9k]

How many of the millions of people currently working from home will ever get back to their office ?
How many will keep their jobs even if COVID settles down ?

This links backs to Dona's article on the risks of a global depression arising from COVID. (That was an excellent article.)

Coronavirus work from home might become work done overseas
Forced away from city centres to slow the spread of coronavirus, the work-from-home revolution has shown many jobs can be done from the suburbs as easily as they were in humming office buildings housing thousands of workers.

Key points:

Key points:

• Business process outsourcing (BPO) is where parts of a company's core operations are outsourced to third-party providers
• Economists warn that many businesses will realise they can operate with fewer workers or perhaps cheaper workers located overseas
• However, some companies are onshoring rather than offshoring during the COVID-19 crisis, with Westpac bringing back 1,000 call centre jobs from overseas

Could the shift be the change that regional Australia has long waited for? Or does it mark the moment Australians have to compete in the global market for jobs, with equally qualified but much cheaper workers?
https://www.abc.net.au/news/2020-08-11/covid-work-from-home-might-become-work-done-overseas/12542354

Yeah but we all know that equal qualification does not mean equal skill. You know, on account of all the foreign students who simply buy their degrees.

I know more than a few people that have stuff done overseas only as a cost thing - in their words, it's "a good thing they're so cheap because they're pretty hopeless". Indian accountants come to mind.

It won't take long before they simply aren't cheap enough to be worth the headache. Even chinese wages are like 10x what they were a generation ago.

 

[satanoperca]

Yeah but we all know that equal qualification does not mean equal skill. You know, on account of all the foreign students who simply buy their degrees.

I know more than a few people that have stuff done overseas only as a cost thing - in their words, it's "a good thing they're so cheap because they're pretty hopeless". Indian accountants come to mind.

It won't take long before they simply aren't cheap enough to be worth the headache. Even chinese wages are like 10x what they were a generation ago.

You are just a grass hopper.

Tell your friends, they are dickheads, it is not about price, it is about quality and willingness to work.

I hate white Australians, dumb and naive. I am a racist towards white people and their inability to understand cultures for doing trade.

 

[over9k]

You are just a grass hopper.

Tell your friends, they are dickheads, it is not about price, it is about quality and willingness to work.

I hate white Australians, dumb and naive. I am a racist towards white people and their inability to understand cultures for doing trade.

Everybody knows that the foreign students purchase their degrees. Hell, I even had a lecturer tell us (off the record) that he's failed foreign students only to have his superiors come in over the top of him and pass them. ****, four corners even did a big thing on this a while ago when a few whistleblowers came forward raising the alarm about this happening for MEDICAL DEGREES.

Get as angry as you like, I've clearly hit a nerve for a reason

 

[Chronos-Plutus]

Everybody knows that the foreign students purchase their degrees. Hell, I even had a lecturer tell us (off the record) that he's failed foreign students only to have his superiors come in over the top of him and pass them. ****, four corners even did a big thing on this a while ago when a few whistleblowers came forward raising the alarm about this happening for MEDICAL DEGREES.

Get as angry as you like, I've clearly hit a nerve for a reason

Just looking back at some of nonsense that you have said:

You said: that we were approaching winter when we were in the middle of winter.

You said: that gold is measured in USD when it is measured in weight.

You said: that China had never been a superpower when China has been a superpower.

You said: that people don't need a formal academic qualification and now you're complaining about medical degrees.

This really is beyond funny now; it is sad.

Go get some help, you really need it.

 

[IFocus]

I know more than a few people that have stuff done overseas only as a cost thing - in their words, it's "a good thing they're so cheap because they're pretty hopeless". Indian accountants come to mind.

My own experience with Indian Elect Engineers and process control programmers was that they were 1st class still not to say there are others that are not

 

[Smurf1976]

In a disguise,this virus mismanagement could be our chance
Bring us to the ground to rebuilt before we get economically and mentally too weak for rebirth

In the context of this thread, I'm seeing that what we can gain is to identify the things which are likely to increase and decrease going forward so as to invest accordingly.

Some of those changes may be "natural" reactions to the virus and government response, others may be brought about due to community or government pressure to do something about the economy etc.

Interested to hear everyone's thoughts but some things I have in mind that we'll see less of are:

"Education" as a big business.

International tourism as an export industry that's seen as an alternative to some other form of economic activity.

Outsourcing in general. The risks have been highlighted well and truly from supply chains to security contractors.

Offshoring things like call centers. That one's driven mostly by community perception and pressure. Any business with an offshore call center has a cross against it so far as employing Australians and so on is concerned and a call center is something that's rather hard to hide that it's not local due to accents etc.

Big cities and apartments. For those in a position to choose where to live, Melbourne and Sydney now seem far less attractive than they did not too long ago and so does the concept of living in an apartment tower anywhere.

Free trade - wasn't really happening anyway and personally I think it's well and truly stuffed at this point.

FIFO - Another risk exposed especially when it's between states. FIFO from Perth to a mine in WA is one thing and will continue but FIFO from Launceston to a corporate job in Melbourne is a risk that has now been made rather obvious if that job can't be done remotely.

China - Reliance there is another risk that has been laid bare for all to see. Not one that's easily solved but I expect there'll be attempts to do so.

I'm thinking we'll see more:

Processing of minerals and so on. Already seems to be some movement there to limited extent and it's an obvious thing for governments to push.

A "buy local" approach from governments and also big corporates wanting to be seen as socially responsible.

A general push from government that anything deemed critical be sourced locally where possible or at least from multiple overseas suppliers and preferably those countries deemed "friendly".

Infrastructure - the most obvious way to put people to work that governments can orchestrate and which has at least some long term value is building infrastructure.

Office work done from places that aren't big office towers in Sydney or Melbourne. Having a concentration of staff all in one city is a risk that's one thing. Reality that some of the best employees will be looking for opportunities that don't involve getting on crowded trains to a job in the CBD of a large city gives business a strong incentive to find ways to may other approaches work. If they don't, the competition will.

Real risk management. All of a sudden pretty much everyone understands that "very unlikely to happen" is not a valid reason to dismiss any risk and that "consequence if it did happen" is key to identifying where to focus effort. That changes the debate on all those things which have been dismissed as "unlikely" - that always was missing the point in a situation where we're outright stuffed beyond belief if it does happen. Fuel supply disruption is one, military threats are another.

Just my thoughts which I'm putting here to prompt discussion. No doubt I'll be wrong about some of it at least......