Numerators and denominators

I find myself having the same debate with people who are in a state of full-blown panic over the coronavirus, which I find just amazing. They assume that countries who are not being forthright about the number of people that have been infected means that the illness is actually much worse than it seems.

I agree that it is unlikely that the “official” numbers being released by countries like China and Iran are anywhere close to accurate. Approximately none of the information that comes out of these regimes on any topic is accurate, but that does not stop the US media from spreading their misinformation and propaganda anyway. Remember when Iran didn’t shoot down a passenger jet until they did?

But lying about statistics does not necessarily mean the death rate of the illness is worse than it is. In this situation, you have people who are infected, people who have died from the illness, and false positives and negatives.

So said interlocutors think the number of deaths coming out of Iran being a higher percentage of the total infected means China was lying about the severity of the disease. That is not correct. If you assume that not everyone who is infected is being tested or seeking treatment, mathematically that is decreasing the percentage of people who die from the illness.

Access to care is another issue. Fewer people are going to die from any cause in a country where they have more access to better quality care. In China, the illness had a disproportionate impact on certain regions because of how the government decided to ration care. And people panicking also increases social costs unnecessarily. It’s a lot easier to have a stable health system when you have stable local economies.

At the end of the day, the coronavirus situation is like any other cycle of illness coming from places with low standards for public health. If you have a medically vulnerable person in your household, these illnesses are major life-and-death issues. If you work in the health care field where your immune system is inundated with illness, these illnesses are major life-and-death issues. But for the population at large, this is not Armageddon.

The noise this is creating in the economy and financial markets is something to behold though. People who are in the business of hospitality are freaking out. But the panic buying is going to be an interesting retail sales stimulus. And it’s all happening because people are committed to circulating bad information, either because they are gullible or love the drama so much.

My favorite argument coming out of these people is that the US cannot manufacture and distribute a vaccine for years. That’s simply not true about the vaccine pipeline, or anything in manufacturing for that matter. Heck, the US researched and developed a nuclear bomb in less time than that in World War II, an era before computers, and we do not have lesser minds working in the health care industry now.

There is a lot of garbage being talked about this illness, mostly by people with a political agenda.

One thought on “Numerators and denominators

  1. As I commented on another blog this morning, my wife and I were discussing the H1N1 pandemic in 2009. Remember that one? I didn’t, but my wife did as it had some impact on her job. The virus was a global pandemic and it is believed it entered the US from Mexico. About 250K Americans would be infected and around 2600 died from winter to fall fo 2009. The Obama Administration waited over 6 months and after 1000 American deaths before declaring a health emergency and taking action. If you look at the DJIA for that year, the bottom of the 2008 financial crisis was reached in March 2009 and then would begin a steady climb of about 50% by the end of the year. There was no impact.

    I think the differences this time around are: (1) China is more integrated into the global supply chain; and (2) this is an election year (and Orange Man bad).

    One positive outcome of this is that this will diminish China’s role in the global supply chain. Expect lots of companies to move operations to other countries in Asia. But the big beneficiaries should be Mexico and the US heartland, both of which will be attractive again due to the USMCA. We should move sourcing of all pharmaceuticals to the US, including raw materials, where they can be adequately monitored by the FDA (which they are not in China). The only reason a company should have a manufacturing plant in China is to supply the Chinese market. And even that may be a stretch. I do not trust the Chinese one bit; they lie, cheat, and steal. At the company where I formerly worked they completely copied one of our manufacturing plants we buiit there without our knowledge, down to the last nut and bolt. No licensing, no royalties, nada. It was only by accident we learned what they had done. Cut them loose.

    Liked by 1 person

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