Monday 27 April 2020

So how bad is it?

This is the biggest unknown question at the moment  - jut how bad is Covid-19 and how bad is the economy?

Boris is back at work today, but after the scare he had you can imaginehe will be very conservative on following the health guidance.

But the Government is rapidly getting into crazy amounts of debt and the economy is ruined for a generation already. People are talking about a recession worse than 2008 (supposedly a once in two generation event) but to me it seems not really dealing with what that means.

The comparison is now crucial because it will determine the next phase. At some point lockdown will be releaxed, but I fully expect a crash in the stock markets and property prices at that time, as the damage becomes more visible.

In parrallel we will know if the end of lockdown increases the virus spread once more and by how much. It could be we get back to the early March situation very quickly, or it could be that we stabilist with it in our society but at a lower level.

Closing our economy will kill tens of thousands of people, this will only exaccerbate the curretn situation. Already hospitals are empty as people stay away, many of the 'excess' deaths reported are likely to be not Covid but people dying of strokes and heart attacks at home. Missing cancer scanning and treatment is also lethal.

Such a hard balance to get right, but to my mind the Government should press on with ending lockdown at the beginning of May to begin an assessment of the situation, following the Red/Amber/Green type strategy recommended here and elsewhere a couple of weeks ago.


DJK said...

Sadly, the deaths are real. See, which shows that excess deaths in England are a 48-sigma event this year.

Australia, New Zealand, and even parts of Eastern Europe are the models to follow, with the virus supressed to very low levels and consequently, a functioning economy. Unfortunately, getting from where we are to where we'd like to be is not easy, if it's possible at all.

Chris Whitty says that only 10% of people in the UK have had Covid-19. That resulted in 20,000 hospital deaths and probably another 10,000 in peoples homes and care homes. So if we open up the economy and just let the virus rip until it stabilizes at 60% of the country infected, that will mean another 150,000 deaths. Anybody think that is politically feasible?

Finally, who in the wider world would want to visit or trade with a UK where the virus is running unchecked.

Alas, no painless options here.

Jan said...

I think some people are quietly taking matters into their own hands.

I have a ready-made economic indicator in the station car-park which I pass every day on my exercise. Since the beginning of the lockdown there have been 5 cars there each day which I think are those of the staff. Today for the first time there were 3 more cars parked. This car-park pre-Covid was usually rammed on week days with commuter cars.

I shall be watching progress each day and keep a tally of the cars parked. I somehow doubt it will ever go back to what it was as many people have got used to working from home and businesses have been adjusting to the new normal. If so that will be a godsend for all those commuters who had ridiculous daily commutes.

E-K said...

We have been well and truly buggered by the CCP. The West should pay back any debt to China at a pound a month - but then what will the CCP release upon us in revenge ? Airborne ebola ?

"Politically feasible"

Nothing is politically feasible now. The mother of all economic depressions is about to hit us. We'll be forced to buy more Chinese tat than ever.

Australia and New Zealand are different countries to ours. Lots of space and largely conservative mono cultures. New Zealand has 3 million fewer people to deal with than the Mayor of London and the land mass of England.

We don't know who is dying *of* or *with* CV19 and I don't think anyone over the age of 78 (the average age male mortality) with a life threatening condition (even mild ones) should be counted as *of*.

It is interesting to note that France and Belgium are doing a lot worse than us but you wouldn't know it from the MsM. Also that Trump's America has just over half the death rate of France - never let that get in the way of telling you "50,000 Americans have died !" without any context.

Either way, economic crash, CV19 decimation, both or neither... the Conservatives are going to get a kicking and be out of office.

"Politcally feasible" and politics run by Piers Morgan has a lot to answer for.

Letting the virus rip ? Well it does get it done and dusted, all we're doing is extending the deaths over a longer time scale in the hope of a vaccine sometime never. And as of being a global pariah ? Well China doesn't give a shit about that and the BBC doesn't scrutinise them at all. Not one bit.

We should be isolating the vulnerable as much as possible and letting the rest work. Alas the global league table doesn't allow us to do that despite the fact that we don't know how each country is keeping score.

E-K said...

Jan - I agree. I think commuters will either have gone bust or figured that working from home is feasible. The rail industry is stuffed. I'm not entirely sad about that. Lots of entitled and overpaid people in it.

E-K said...

Sweden has 80 fewer deaths per million than we do.

Anonymous said...

Reopening the economy, or keeping it closed, will create deaths either way.

Had the lockdown not happened, most of those operations not happening now, wouldn't have happened anyway, and the timescale of "not happening" would be long as the virus took down, and likely killed, enough NHS staff to create a health care crisis on a frightening scale.

There's no right answers, no matter how the media may scream for one, there's just hoping the selected option is the least worst with no way of knowing if it was until long after the event.

There needs to be a reckoning with China over this, although how to do that without causing some form of conflict I don't know.

YDG said...


"the Conservatives are going to get a kicking and be out of office. "

I'm not so sure about that. Bear in mind that the entire country is now living
the socialist dream - empty shelves in supermarkets, queues, most high-street
shops closed, almost anything you might want to do for fun is banned, high and
rising unemployment, soaring national debt. Most people accept this for now,
as a temporary, emergency measure because they believe it is necessary to
avoid an even worse outcome. However, the Labour loons that are now saying
things like "Jeremy won the argument" or even "Covid 19 means you get Labour
policies regardless of how you vote" are telling us that Labour's offer at the
next election is ... "You remember what your life was like under lockdown?
Well, vote Labour and you will live that way permanently". Except it's
even worse than that for Labour. Their usual electoral offer is "Free Stuff! -
free broadband, free University, free healthcare, free everything!" but
this government will have no choice but to push borrowing, taxation and even
money printing to the limits - maybe beyond - so there will be no scope for
Labour to promise spending increases.

It would be tough for Labour at the best of times, but as the party of
pretentious, out-of-touch, metropolitan guardianistas they have no chance when
Rishi Sunak is in the process of wearing out the only club in their golf bag.

Anonymous said...

I am currently renting. I have had an offer accepted on a house, but can obviously pull out at the moment. Exchange is 3 weeks away.

I had decided to go ahead with it due to the risk of inflation (most of my assets are in cash at the moment). I seem to be almost the only one worried about this though... why is this? With all the money being printed, and people being paid not to work? Have people calculated that the new money is a drop in the bucket compared to the destruction that's taking place?

Equity in house would be 50%, and I will have > 2 years' expenses of cash in the bank after the purchase, so relatively low risk... but now having serious doubts nonetheless.

Why are people so unconcerned about inflation?

Anonymous said...

anon. re inflation
i agree with you. its a worry.
we make a lot less stuff than 2 weeks ago, the only thing we seem to of made is lots of paper money.
as you suggest its going to end up somewhere. if not this month.
tend to think its going to be assets as we've proven we dont need cars/trains/pubs/restaurants. but we sure do need somewhere to stay and hide.

Oli said...

DJK - you can ease things without "letting the virus rip".

There's reearch (not trumpeted by the BBC) from both Oxford and LSHTM showing that deaths peaked on 8 April - which means *infection* peaked 21 days before that, which was actuallty before lockdown began - i.e. even in conditions when people were packing out the Naitonal Parks, infections were falling.

So the evidence for continuing lockdown just isn't there. The brakes need to come off a bit. That needn't mean they come off the whole way - but there's lots you can do without letting it rip.

Don Cox said...

"Sweden has 80 fewer deaths per million than we do."

You might compare Sweden with Britain-minus-London, as there is no giant city in Sweden comparable to London.

New Zealand is doing very well for the same reason. The average distance between people (in normal times) would be a useful index.

Don Cox

dearieme said...

Almost everyone is getting far too excited by comparing numbers that may well be apples to oranges.

Moreover they are doing it far too soon. It's as if some dolt had written a history of WWII in the summer of 1940. Germany Triumphant! A comparison five years from now might be instructive.

My opinions/guesses are these:

(i) People were absurdly insouciant at the beginning: 'Chinese people are getting nasty colds' would be a reasonable paraphrase of what the bone-headed were saying. So we under-reacted.

(ii) People then became far too excited; calm analysis was required and instead we got the 'my model says' crowd creating hysteria, helped no end by the media. So we over-reacted. Specifically, we reacted unintelligently and with far too broad a brush.

(iii) I have puzzled for some time at the disproportion between the reaction of the Chinese government and the dangers of the disease - it's lethal, true, but hardly the Black Death. I now wonder whether it really did escape from a research lab. And when the cock-up scientists briefed the CCP on the damage that the escaped virus might cause, the CCP took their draconian measures. Happily it's turned out to be less bad than these (hypothetical) scientists predicted. So far. The bugger is mutating all the time, after all.

Anonymous said...

@anon 2:28 - I'm not concerned about inflation for 2 reasons:

1) Most nations are in the same boat, so currency fluctuations won't be as large as if it was just us printing money; and

2) Same thing was said about QE, and all the inflation went into assets rather than day-to-day, which likely says something uncomplimentary about the state of our economy.

@Kev - We're not Sweden. The Swedes have a different attitude to us when it comes to socialising, around half already pretty much practiced social distancing before the virus appeared by dint of personality. They've also nowhere near the population density.

They've also got a similar issue to use with care homes.

Nessimmersion said...

Population density is a red herring i.e. whats the population density in Camada or Russia- irrelevant because 80% of pop live in urban/suburban areas, in the 1st world.
Sweden has more social distancing than the deep south of UK, about the same as the Viking roots areas of UK like Northumbria or Shetland.
Different infection rates in Swiss cantons depending on cultural background.

Thud said...

I'm with Dearieme here, its a disaster but one we will manage and come through.

Wildgoose said...

I also agree with dearieme and wonder if there were extra reasons to panic and act on the safe side.

I believe there is a very significant possibility that this is actually the result of an accidental release from the Wuhan research lab that was just a couple of blocks away from the Wuhan wet market. They were far too quick to blame that specific wet market, of which there are thousands of such markets across the whole of Asia.

What a coincidence it just happened to be the wet market a couple of blocks from a research bio-lab researching that specific type of virus. And what a coincidence that around the same time China suddenly threw out all Western journalists.

And then there's the "draconian quarantine lockdown" of the entire province from the rest of China that nonetheless left international airports to the rest of the world untouched? Plus the strong-arming of the WHO to declare that there was no evidence of airborne human-to-human transmission?

So was there extra panic because this is actually an artificial virus specifically designed to be transmissible amongst mammals? In other words the accidental release of a potential bio-weapon?

There have been long-standing complaints by Western researchers at the poor safety standards at Chinese research labs in particular.

And our very own Dominc Cummings was warning about the dangers of something like this happening LAST MARCH. Remarkably prescient:

Hostile media left our politicians in a cleft stick. Do nothing and be blamed if it goes badly. Or do something and at least have the defence that everybody else was doing the same.

But if there is one good thing that comes out of this I hope it is a healthy sceptism of self-declared experts waving around simplistic computer models. Yes "climate scientists", I am talking about you.

Don Cox said...

"And our very own Dominc Cummings was warning about the dangers of something like this happening LAST MARCH. Remarkably prescient:"

Anyone with the slightest knowledge of biology has been expecting a major plague for years.

The surprising thing about this virus is the low death rate. The next one is likely to be much worse.

Don Cox

CityUnslicker said...

see my pinned tweet on my twitter profile for a very simple examiniation that shows it is much more likley to have originated in the lab than the wet market - all with sourced public infomation.

E-K said...

+ 1 Don

China should have isolated herself at the first inkling that an accident had taken place.

Hopper said...

DJK - while I'm reasonably sure that cumulated excess deaths will continue to grow for a while, we're currently "only" 23% over 2018 according to those graphs (all ages) - that doesn't feel like a 48 sigma event. It doesn't even feel like a 2 sigma event *at this point* - 2018 was only two years ago.

DJK said...

CU: Re the origin of the Wuhan flu. You'll have to help me out, I can't find this pinned tweet on your Twitter feed, but I'm interested in the reasoning.

Hopper: It's 48-sigma based on the SD of the last ten years or so of data, arranged by week. Of course, real world events have fat tails, so it's not a Gaussian 48-sigma. The point is that it's not "only 23% excess", it's 23% when normally the death rate is predictable within 1% or so.

Matt said...

While the video in CU's Twitter feed is not all conspiracy, it's also not fact either despite it being based on public sources/references.

It suggests that COVID-19 was artificially brought over from bats to humans but also mentions that a number of villagers, from the area around where the bats were captured, were tested positive for the virus. So it's likely the transition from bat to human had already taken place. It's possible the lab may have amplified the amount of virus however.

Also, the small distance between the lab and the Wuhan wet market is cited as a reason it could have been the source. Correlation is not causation and it's possible that any incidence of virus in the lab was because the staff went to the wet market for food.

Sobers said...

"Also, the small distance between the lab and the Wuhan wet market is cited as a reason it could have been the source. Correlation is not causation and it's possible that any incidence of virus in the lab was because the staff went to the wet market for food."

Sorry but that doesn't pass the smell test. Possible, yes, lots of things are possible. Probable? No.

Workers at a lab that definitely does contain bat coronaviruses go to go to a local food market and just happen to get infected with a naturally occurring strain of exactly the same virus they are in contact with at work vs workers at the lab that definitely does contain bat coronaviruses get infected at work and transfer that infection to lots of places locally, including a local food market. Which direction of infection sounds more likely to you?