Coronavirus outbreak: WHO’s decision to not declare a global public health emergency explained
by ilene - January 28th, 2020 2:39 am
Coronavirus outbreak: WHO's decision to not declare a global public health emergency explained
Masks are selling out in Singapore amid concerns about the Wuhan virus. Ng Sor Luan/EPA
Courtesy of Tom Solomon, University of Liverpool
The World Health Organization’s decision to not declare the novel coronavirus outbreak in China a public health emergency of international concern, or PHEIC, will surprise many. The number of reported cases and deaths is doubling every couple of days, and patients have now been reported from many Asian countries, as well as the Middle East, Europe, Australia and the US.
You might wonder how bad things have to get before this is deemed to be a global public health emergency. But such declarations by the WHO are not taken lightly, as Tedros Adhanom Ghebreyesus, director general of the World Health Organization (WHO) explained in the press conference.
The concept of the WHO declaring global public health emergencies first arose after the 2003 Sars coronavirus outbreak. As with the current outbreak, it started in a live animal market where the spread of infected excrement to humans allowed the virus to cross the species barrier. But unlike the current situation, the Sars epidemic was growing for many months in China before authorities admitted they had a problem. By the time the Sars outbreak was brought under control, there were over 8,000 cases and 700 deaths in 37 countries.
The WHO decided that declaring a PHEIC, introduced as part of the 2005 International Health Regulations, would help manage these situations.
Previously, under legislation that was 150 years old, cholera, plague and yellow fever were contained by quarantine and embargoes at a country’s borders. The 2005 legal framework focuses on containing an outbreak at its source, with an emphasis on preparedness. It requires countries to maintain necessary “core capacities”, such as the ability to diagnose infections and isolate infected patients. And rather than only being able to report specific known diseases, they can report unusual public health patterns, for example an unexpected increase in patients with severe respiratory symptoms.
A PHEIC is declared when there is “an extraordinary event which is determined … to constitute a…
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Animal Spirits: Short Squeeze
by ilene - January 27th, 2020 9:15 pm
Animal Spirits: Short Squeeze
Courtesy of Michael Batnick
(This article was originally posted on 1-22-20.)
Today’s Animal Spirits is brought to you by YCharts. Mention Animal Spirits to receive 20% off (*New YCharts users only)
On today’s show we discuss:
- Can financial literacy be improved?
- Has the 401(k) passed its expiration date?
- The new American retirement plan
- Almost 90% of Americans over age 65 receive Social Security benefits.
- Pay Is Rising Fastest for Low Earners
- Are yawns contagious? Yes
- The Fed is causing a bubble in everything
- Central banks are driving up risk taking
- Stocks are going nowhere, fast
- Long-term return expectations
- Credit cards of the future
- BlackRock going in on ESG
- Startups everywhere?
- What should yo work on?
- An NBA player is on the Blockchain
- Should I buy a house?
Charts:
Recommendations:
Tweets:
I read it but don’t find it persuasive. 6-9 months ago there was widespread talk of an impending recession, triggered in part by yield curve inversion. /1 https://t.co/4Dz7LBkw3Q
— Neel Kashkari (@neelkashkari) January 17, 2020
The 10 most trusted brands in America, according to new poll by @MorningConsult pic.twitter.com/Jtw89Hni9t
— Darren Rovell (@darrenrovell) January 13, 2020
Don’t know who put this together. But I think it’s a great reminder of the burning need for creativity and differentiation. #marketing #design pic.twitter.com/dn8ySGHU24
— Fer Machado (@fer_machado123) January 15, 2020
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How CEOs, experts and philosophers see the world’s biggest risks differently
by ilene - January 27th, 2020 8:23 pm
How CEOs, experts and philosophers see the world's biggest risks differently
Activist Greta Thunberg was among attendees who want the world’s leaders to prioritize fighting climate change. AP Photo/Michael Probst
Courtesy of Christopher Michaelson, University of St. Thomas
We live in a world threatened by numerous existential risks that no country or organization can resolve alone, such as climate change, extreme weather and the coronavirus.
But in order to adequately address them, we need agreement on which are priorities – and which aren’t.
As it happens, the policymakers and business leaders who largely determine which risks become global priorities spent a week in January mingling in the mountainous resort of Davos for an annual meeting of the world’s elite.
I participated in a global risk assessment survey that informed those at the Davos summit on what they should be paying the most attention to. The results, drawn from experts in a broad range of disciplines including business, happen to be very different from what company CEOs specifically see as the biggest threats they face.
As a philosopher, I found the differences curious. They highlight two contrasting ways of seeing the world – with significant consequences for our ability to address societal risks.
Wildfires in Australia have destroyed more than 3,000 homes and razed more than 10.6 million hectares since September. AP Photo/Noah Berger
Two perspectives on the biggest risks
The World Economic Forum’s Global Risk Report consolidates the perceptions of about 800 experts in business, government and civil society to rank “the world’s most pressing challenges” for the coming year by likelihood and impact.
In 2020, extreme weather, a failure to act on climate change and natural disasters topped the list of risks in terms of likelihood of occurrence. In terms of impact, the top three were climate action failure, weapons of mass destruction and a loss of biodiversity.
The specific perspective of corporate leaders, however, is captured in another survey that highlights what they perceive as the biggest risks to their…
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Fed Repos Have Plowed $6.6 Trillion to Wall Street in Four Months; That’s 34% of Its Feeding Tube During Epic Financial Crash
by ilene - January 27th, 2020 9:24 am
Courtesy of Pam Martens
Jerome Powell, Chairman of the Federal Reserve
According to the data made available on the public website of the New York Fed, since September 17, 2019 it has funneled a cumulative total of $6.6 trillion to some of the 24 trading houses on Wall Street that are known as its “primary dealers.” The giant sum has been sluiced to Wall Street in the form of repurchase agreement (repo) loans without any details being provided to the elected representatives in Congress as to which firms are getting the money or what it’s being ultimately used for. But since the stock market has set repeated new highs since the program launched, some veteran market watchers believe the Fed is fueling a Ponzi-like rally in stocks.
When the nonpartisan investigative arm of Congress, the General Accountability Office (GAO), tallied up the cumulative total that the Federal Reserve had secretly sluiced to Wall Street from December 2007 through July 21, 2010, it came to $16.1 trillion. (See chart below.) But the GAO did not include all of the programs that came out of the New York Fed. When those other programs are added, the Levy Economics Institute, using the Fed’s own data, arrived at the tally of $19.559 trillion to the Wall Street trading houses and another $10 trillion in central bank liquidity swaps, bringing the bailout figure to over $29 trillion.
Why is it essential to report on the cumulative tally that the New York Fed pumped during the crisis and is doing once again to Wall Street’s trading houses? As L. Randall Wray wrote in 2011 to explain Levy’s calculations: “The cumulative lending by the Fed contributes to our understanding of the depths of their [the Wall Street banks’] problems.”
The fact that both the auditors at the GAO and the university academics working on behalf of the Levy Economics Institute found the cumulative tally to be important means that it is important to report to the American people.
There are other key reasons to keep a close tab on the cumulative tally. The cumulative tally during the financial crisis was a measure of just how long an emergency response…
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Preparing For Lower Returns
by ilene - January 27th, 2020 12:14 am
Preparing For Lower Returns
Courtesy of Michael Batnick
We’ve been hearing about the prospect of lower future returns for U.S. based investors for years now*. The thesis behind this is fairly straightforward; high recent returns coupled with high valuations in the stock market, and low interest rates in the bond market is not conducive to further above average returns.
Consider the following:
- A U.S. only 60/40 portfolio has compounded at 10.5% over the last 10 years.
- The CAPE ratio is at 30.9
- The ten-year treasury is currently yielding 1.8%
The more you pay for an asset relative to its underlying fundamentals, the less you should expect to receive going forward. You can see this relationship in the chart below, which plots the inverted CAPE ratio on the left-axis, and forward 10-year returns on the right-axis.
But valuations don’t matter over the short-term, sometimes matter over the medium-term, and usually matter over the long term. This is a long way of saying that valuations are a terrible timing tool, as we’ve learned over the last few years. We can see the relationship between higher valuations and lower returns in the chart below. Again, they matter, but no guarantees.
Future bond returns, unlike stocks, can be boiled down to a single variable, starting yield. The chart below shows the relationship between the starting yield of a ten-year bond and the future ten-year returns.
Below is a scatter plot that shows just how tight this relationship is. Starting yield tells you pretty much all you need to know about forward returns.
Okay, so we suspect that the above average returns we’ve been accustomed to won’t continue forever. The obvious question is, what do we do with this information?
Here are a few ideas (not investment advice)
Go beyond the S&P 500. Value stocks have done well, despite lagging by nearly 2% per year, foreign stocks, both developed and emerging, have done bubkis, while commodities have done downright awful.
If you’re worried about not just lower returns, but a potential market crash, realize that…
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Coronavirus does not look like a ‘black swan’ event – here are some reasons to be cautiously optimistic
by ilene - January 26th, 2020 8:24 pm
Coronavirus does not look like a 'black swan' event – here are some reasons to be cautiously optimistic
Courtesy of Zheng Wang, De Montfort University
The alarm is sounding again. The Asia financial markets were reasonably calm about the new coronavirus until the news of the lockdown of the whole city of Wuhan in China on January 23, where the first and most cases have been reported so far. After that, markets started tumbling. Everything from stock markets to Brent crude drifted down by several percentage points as all eyes were on ticker screens for the latest news.
Markets steadied and rose a little on January 24 as investors appeared to suspect that the fears were being overdone, but the situation remains on a knife edge. The worry is that this could be a black swan event, one that is so unpredictable and grave that it can bring about a severe downturn in the global economy. The September 11 attacks in 2001 are the most obvious example.
The big question is whether we are facing another situation on the scale of, if not bigger than, SARS in 2002-03. Caused by a similar airborne virus that originated from China, that global outbreak infected more than 8,000 people and killed nearly 800 before it was contained. So what can we learn from that crisis about the potential financial implications this time around?
The government response
If we look back at Hong Kong, the city that was most badly hit by SARS, the data shows that the negative impact was short-lived. Its financial market, tourism, consumption and GDP all plummeted initially but bounced back quickly to previous levels within a few months. Similar patterns were found for mainland China.
There are a few reasons to be at least as optimistic this time around. First, the central and local governments in China are more experienced and seem to be acting more responsively than during the SARS outbreak. Although there has been much public criticism that the government and public health authorities were slow in determining the risk and severity of the virus, they stepped up the pace once they had decided the situation was sufficiently serious.
They quarantined Wuhan, a mega city…
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Silicon Valley’s latest fad is dopamine fasting – and that may not be as crazy as it sounds
by ilene - January 26th, 2020 4:25 am
Silicon Valley's latest fad is dopamine fasting – and that may not be as crazy as it sounds
Dopamine fasting, the newest fad to hit Silicon Valley, is being used as a way to get over addictive habits. SewCream/Shutterstock.com
Courtesy of A. Trevor Sutton, Concordia Seminary
Silicon Valley’s newest fad is dopamine fasting, or temporarily abstaining from “addictive” activities such as social media, music, internet gaming – even food.
Twitter’s CEO, Jack Dorsey, for example, is known for his intermittent fasting diet. Other celebrities such as Kourtney Kardashian and Chris Pratt have also lauded the benefits of intermittent fasting.
Dubbed “dopamine fasting” by San Francisco psychologist Cameron Sepah, the trend is getting increasing international attention as a potential “cure” for technology addiction.
Dopamine is a brain neurotransmitter that helps control basic functions such as motor control, memory and excitement. It is also involved in anticipating the reward of a stimulating activity. Denying the brain the dopamine-derived pleasure of many modern day temptations, the theory goes, may help people regain control, improving focus and productivity.
This idea did not entirely originate in Silicon Valley. As a scholar who studies digital technology and religion, I’d argue that the motivations and benefits of dopamine fasting resemble what many religions have been teaching since ancient times.
Religious traditions and fasting
Fasting can take multiple forms in different religious traditions.
Muslims observe nearly a month-long fast during Ramadan when they abstain from food or drinks. They are allowed to break the fast only after the Sun goes down.
A woman preparing the meal for breaking the Ramadan fast at sundown. Isvara Pranidhana/Shutterstock.com
The Jewish holiday Yom Kippur, also known as the Day of Atonement, includes a period of fasting. And many Christian traditions observe fasting periods throughout the year, particularly during the Lenten season leading up to Easter. Vipassana meditation, a practice with Buddhist roots, involves abstaining from speaking for multiple days.
The reasons these ancient religions encourage…
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BOGUS DEFENSE BINGO
by ilene - January 25th, 2020 12:02 pm
BOGUS DEFENSE BINGO
Courtesy of Teri Kanefield
(Teri is an author, political commentator and lawyer. Visit her blog for more of her thoughts here.)
If the Trump Defense Trial Brief is any indication, we will be hearing lot of bogus defenses and crazy conspiracy theories.
I wanted a way to get through it without wanting to poke my eyeballs with a fork.
So I came up with an idea: Bogus Defense Bingo. You can get your bingo card here.
If you want to know how I would defend this case, scroll to the bottom. I can think of only one non-bogus defense, but I’m sure Team Trump will not use it.
If there is a valid defense presented, I’ll be sure to let you know right away.
Note: The explanations for why the defenses are bogus are not complete. For each, I listed only a few reasons.
I: The Bogus Defenses: Explanations
#1: The call was perfect
Variation: The call shows no link between aid and political investigations
Why it’s bogus:
- The call was one part of a months-long campaign. Looking only within the four corners of the call is cherry picking evidence.
- Trump talked about investigations in the call (“look into some things”)
- The investigations were into his political opponent (thus political)
- Just because Trump didn’t announce a corrupt intent during the call doesn’t mean there was no corrupt intent
#2: Trump had “valid concerns” (about Biden, Burisma, or Ukrainian interference in 2016)
Why it’s bogus:
- All the theories about the Bidens have been debunked and are baseless
- If Trump had concerns, he should have followed legal procedures (for Ukraine, perhaps an independent prosecutor)
- His henchmen pushed for an
…
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The Wuhan Wipeout – Could It Happen?
by ilene - January 24th, 2020 10:48 pm
Courtesy of Technical Traders
News is traveling fast about the Corona Virus that originated in Wuhan, China. Two new confirmed cases in the US, one in Europe and hundreds in China. As we learn more about thispotential pandemic outbreak, we are learning that China did very little to contain this problem from the start. Now, quarantining two cities and trying to control the potential
outbreak, may become a futile effort.
In most of Asia, the Chinese New Year is already in full swing. Hong Kong, China, Singapore, Malaysia, India and a host of other countries are already starting to celebrate the 7 to 10 day long New Year. Millions of people have already traveled hundreds of thousands of miles to visit family throughout this massive celebration. We are certain that hundreds or thousands have traveled to all parts of the world by now. The potential for exponential growth in the threat from this virus could be just days or weeks away.
Far too many people are too young to have any knowledge of the 1855 Third Plague Pandemic that originated in China. This outbreak quickly spread to India and Hong Kong and claimed 15 million victims. It lasted until the 1960s when active cases of the Plague dropped below a couple hundred.
If we consider the broader scope of this issue, we have to take into consideration the results it may have on the
broader global economy, commodities and consumer activity as skilled traders.
The world is much bigger than it was in 1855. We have more technology, more capability and faster response capabilities related to this potential pandemic. Yet, we also have a much greater heightened inter-connected global economy, currency, and commodity markets. What happened in China can, and may, result in some crisis events throughout the planet. It is not the same world as it was in 1855. (Source: history.com)
It is far too early to speculate on any future economic outcomes related to this potential outbreak, but it is fairly
certain that China, most of Asia, India and potentially Africa could see extensive economic damage related to a contraction in consumer and industrial economic demand as a consequence of this outbreak. Once the Chinese New Year ends, in about 10 to 15+…
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Wuhan coronavirus: we still haven’t learned the lessons from SARS
by ilene - January 24th, 2020 7:59 pm
Wuhan coronavirus: we still haven't learned the lessons from SARS
Courtesy of Diana Bell, University of East Anglia
The SARS outbreak in 2002-2003 was the first global pandemic of the 21st century. There were 8,422 reported cases and 11% of those infected with the virus died. Its cause was a newly identified coronavirus (a type of virus that causes respiratory infections): SARS Co-V. Early cases were linked to wildlife markets and restaurants in Guangdong, China, where researchers found SARS-like coronaviruses in animals including masked palm civets and a racoon dog.
A Chinese government team subsequently reported that 66 out of 508 wildlife handlers tested in other markets across Guangdong were positive for antibodies to the SARS virus. The Chinese authorities responded by imposing a temporary ban on the hunting, sale, transportation and export of all wild animals in southern China. They also quarantined or culled civets reared for human consumption in the many civet farms across the area.
We happened to be working on wildlife trade and biodiversity conservation, including rare species of civets in neighbouring Vietnam, and were aware that many different species of animal were kept close to each other.
My colleagues and I suggested that civets testing positive for SARS may have secondary infections rather being than the source of the virus. They were probably infected during the “speed dating” of zoonotic viruses circulating among the jumble of different animal species packed together at markets or while being transported to markets, often in China.
At the Royal Society’s international conference on “Lessons from SARS” in 2004 and in the related publication, we emphasised that wildlife trade was a threat to human health and a primary cause of biodiversity decline in China and South-East Asia.
But here we are again, 17 years later, with another novel zoonotic coronavirus, this time in Wuhan, China. Once again, initial human cases were linked to a market selling a variety of live animals.
A constantly changing range of species have been selected as the culprits in the past few days, including bats and snakes, (the latter results were quickly refuted), and even crickets and wolf…
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW. She manages the site
