Global markets are down more than 1%.
Chinese markets are closed for the holidays or they would be down too as about 3,000 people are now infected by the coronavirus and it was 1,000 when I warned about it on Thursday so we're close to 50% daily increases in infections and we still aren't clear on the incubation period of the virus and we have no treatment for it either. That is, as we say in the medical community – NOT GOOD!
Unfortunately, the breakout is imitating the pattern of the Spanish Flu (influenza), which devastated the planet, ultimately infecting 500M people and killing 25M (5%) of them in 1918. Even with our much more modern medicines, the death rate on the coronavirus is at 3% but modern medicine comes at a price and hospitalizations quickly run into thousands of Dollars and even if 500M people can be treated for $2,000 (mostly not in hospital, of course), we're talking about $1Tn of emergency aid required (1% of Global GDP) - plus money that needs to be allocated to prevention, education and support.
Do you have an extra $1,000,000,000,000 set aside in case of emergency? We'll find out who does and who doesn't as China has already pledged $9Bn to help contain the virus and, if you do the math, that's $3,000 per infected patient in a country where health care costs are 1/4 of what we spend in the US. Let's hope the infections level off soon but there's not likely to be a quick fix to this thing and, even in the best case, China is shut down for 2 weeks and that's going to hit the GDP for about $400Bn (2.8%) – so the effect on Global Markets will be lingering.
Speaking of $400 (M in this case) – it turns out Trump DID specifically and directly tell John Bolton, way back in August, that he was withholding military aid to the Ukraine unless they agreed to investigate Joe Biden. Since Trump's own lawyers have said that the only way he should be impeached is if you could directly tie…