By comparison, Covid-19 is not especially life-threatening. According to the best available data at the time of writing, there have been about 85,000 confirmed cases worldwide, roughly 94% of them in China, and 78% of them in the province of Hubei. The implied global mortality rate is 3.4%, but that is surely an overestimate, because the denominator (total cases) is being underestimated by infected people who don\u2019t feel sick or don\u2019t check themselves in for medical care.<\/p>\n
We also know that, unlike the \u201cSpanish flu\u201d of 1918-19, Covid-19 disproportionately kills the elderly and those with existing conditions, such as cardiovascular disease, diabetes or chronic respiratory disease. Worry about grandparents: the mortality rate for people in their eighties is above 14%, whereas it\u2019s close to zero for those under 40.<\/p>\n
Yet those who blithely say, \u201cThis is no worse than the flu\u201d \u2014 which will likely cause between 16,000 and 41,000 deaths in America this season \u2014 are missing the point.<\/p>\n
What makes Covid-19 dangerous is not so much the threat it poses to the average person\u2019s life, but the threat it poses to economic growth. Uncertainty surrounds it because it is so difficult to detect in its early stages, when many carriers are both infectious and asymptomatic. We don\u2019t know for sure how many people have it, so we don\u2019t exactly know its reproduction number and its mortality rate. There\u2019s no vaccine and there\u2019s no cure. Last week this uncertainty, crystallised by a leap in the number of Italian cases, gave the US stock market its worst week since the great banking crisis of 2008-9.<\/p>\n
I have often been asked in the past few years where the next financial crisis will come from. I have said, time and again, that it will come not from America but from China, now the second-largest economy in the world. Sure enough. A pandemic is very different from a bank run, to be sure, but in each case we witness the same phenomenon, which is characteristic of a networked world: a cascade of consequences driven by fear of the unknown.<\/p>\n
Read it all<\/a> (subscription).<\/p>\n “A Covid-19 outbreak in one or more large American cities would inflict a September 11-level hit on the US economy and a Hurricane Katrina-level hit on Trump\u2019s popular approval.” https:\/\/t.co\/mFHrDbe7eW<\/a><\/p>\n \u2014 Niall Ferguson (@nfergus) March 1, 2020<\/a><\/p><\/blockquote>\n\n