Coronavirus: Seeing Through the Fog of Fear | MarketMinder | Fisher Investments
To turn to something much more in our wheelhouse: the virus s economic impact. It is too soon to know exactly how the coronavirus will impact economic growth. There will almost certainly be some kind of hit, with most forecasts suggesting slowing growth. But, and this is key, it looks to be temporary. Already, various purchasing managers indexes hint at inventories falling while order backlogs rise fuel for a rebound. In China, there are already signs of this. One Chinese online travel agency noted hotel bookings soared 40% in the week ending 3/1 from the prior, while flight demand skyrocketed. In a hard-to-refute sign the country is getting back to work, nitrogen dioxide pollution is back. The gas, a byproduct of utility output and factory emissions, largely vanished amid the twin impact of the Lunar New Year holiday and coronavirus-related shutdowns which NASA captured in a recent image of the week. We aren t cheering pollution, but it seems a pretty tangible sign of a rebound. Of course, there are many other pollutants and China s economy is mostly services these days, not factories. But it still seems relevant to note, in our view.
This is from Fischer Investments, which is in the business of selling stocks. But still, it seems reasonable. Almost certainly, it will be mostly older people who die, but there will be prominent cases of younger people as well. Also, there are permanent health effects for some of the people who get the virus and survive. Probably the economy will bounce back strongly a year or two from now. But I’m not sure China has contained the virus now. Actually, my gut tells me they absolutely haven’t, but I no longer trust my gut on these things.