I am not going to give you the mainstream answer – I rarely do.
This Coronavirus is not another SARS and it is not the same as the flu. We can only hope it is like the annual flu, but I don’t think China would try to lock down 50 million people, close businesses and schools down, and cancel holidays if they thought it was like the flu.
At least for the flu, many people get shots each year and the human species has some immune experience with it. Not this one. It is a whole new ball game. And it is a super-spreader.
The “confirmed” cases in China are growing at 50% a day – 50% a day!!!
If that rate holds, those five confirmed cases in the US would expand to the whole US population by mid-March. It will not expand that fast in the US, but it will be very disruptive. It already is in China.
This virus is explosive because it has a long incubation period and it appears to be infectious during this time. So remember those confirmed cases became infected 8-10 days ago and were out there spreading this virus. Those infected today will be confirmed in 10 days.
That means at a 50% growth rate over 150,000 have already been infected in China and they don’t know it. Then 225,000 the next day and 337,000 the next day and over half a million the next day. You get the idea.
Some people show no symptoms which is great for them. But not for those who they are infecting.
There is a reason the President of China called this a “grave situation” and admitted the spread of the virus is “accelerating”.
My take is there is no way to contain this virus and it will spread globally and so we will have to deal with it. Hopefully, the death rate is low. But it will be economically disruptive at the least.
My free advice for the day – exit equities. All the king’s horses and all the Fed’s liquidity may not be able to stop a market correction.
Invest safe, invest smart.
TSP & Vanguard Smart Investor for serious and reluctant investors.