Posted on 08/18/2005 1:04:51 PM PDT by steve86
August 16, 2005 - 17:24
Flu pandemic could trigger second Great Depression, brokerage warns clients
HELEN BRANSWELL
TORONTO (CP) - A major Canadian brokerage firm has added its voice to those warning of the potential global impact of an influenza pandemic, suggesting it could trigger a crisis similar to that of the Great Depression.
Real estate values would be slashed, bankruptcies would soar and the insurance industry would be decimated, a newly released investor guide on avian influenza warns clients of BMO Nesbitt Burns.
"It's quite analogous to the Great Depression in many ways, although obviously caused by very different reasons," co-author Sherry Cooper, chief economist of the firm and executive vice-president of the BMO Financial Group, said in an interview Tuesday.
"We won't have 30-per-cent unemployment because frankly, many people will die. And there will be excess demand for labour and yet, at the same time, it will absolutely crunch the economy worldwide."
A leading voice for pandemic preparedness said the report is evidence the financial and business sectors - which have been slow to twig to the implications of a flu pandemic - are finally realizing why public health and infectious disease experts have been sounding the alarm.
"I think that this particular report really signifies the first time that anyone from within the financial world, when looking at this issue, kind of had one of those 'Oh my God' moments," said Michael Osterholm, director of the Center for Infectious Disease Research and Policy at the University of Minnesota.
"The financial world is finally waking up to the fact that this could be the boulder in the gear of the global economy," he said, suggesting a pandemic could trigger an implosion of international trade unlike anything seen in modern history.
"All the other catastrophes we've had in the world in recent years at the very most put screen doors on our borders. This would seal shut a six-inch steel door," Osterholm said.
Cooper, a highly influential figure in the Canadian financial sector, wrote the report with Donald Coxe, a global portfolio strategist for BMO Financial Group.
They warn investors the economic fallout out of a pandemic would inflict pain across sectors and around the globe.
Airlines would be grounded, transport of goods would cease, the tourism and hospitality sectors would evaporate and the impact on exports would be devastating, Cooper wrote.
"This would trigger foreclosures and bankruptcies, credit restrictions and financial panic," she warned, suggesting investors reduce debt and risk in their portfolios to be on the safe side.
The World Health Organization and public health leaders have been warning for some time that the world may be on the verge of a pandemic, the first since 1968. Adding considerably to their concern is the fact that the strain they fear will trigger a pandemic, the H5N1 avian flu ravaging poultry flocks of Southeast Asia, is highly virulent.
Even if a pandemic were mild, it is estimated that about a third of the world's population would fall sick over a period of months and millions would die. If the strain is virulent, the toll could mount to scores of millions of deaths, over a period of only 18 to 24 months.
Cooper reminded investors of the economic devastation SARS wreaked on affected cities or countries, including Toronto. But even with that fresh experience to draw from, she admitted it was hard to envisage how widespread the implications of a flu pandemic might be.
"It is a big, big issue. I mean, it's almost imponderable," she said. "I have to admit: the more research I did, the more frightened I became."
Still, she urged investors to embrace prudence, not succumb to panic.
"We wouldn't want everyone to go running out and dump all their investments and bury cash in their mattresses, because it would only accelerate the crisis - at least the financial crisis. But I don't believe people would do that anyway," Cooper said.
---I'm just going to get under my asteroid shield---
Yes, I look back in abject horror at the cataclysmic pandemic of 1968. And, isn't virulence a virtual requirement for pandemics?
: it is estimated that only 750,000 people died of the virus worldwide (34,000 people in the United States) during the two years (1968-1969) that it was active. It was therefore the least lethal pandemic in the 20th century.
Gosh, if the Flu pandemic hits at the same time as a series of big earthquakes, huge tsunamis, killer hurricanes, wild tornadoes, raging forest fires, and an anti-gay rally on the Boston Commons, the world may cease to exist.
Only in Canadakistan, Eh???
Nothing to see here, move along. You're absolutely right - this pandemic thing is way overblown. You'll never know it was here.
Go ahead. Believe that.
This sums it all up!
Reserve your burial plot, while prices are low!
Perfect arrival time as well - just as summer begins to cool off, and fall brings the human flu season out.
No, it won't effect world trade, or any of the markets. No reason to even notice. After all, SARS is as bad as it can get - really. Trust me.
Color coded circles for wild bird H5N1:
May = Red June - Orange July = Yellow August = Green
Square = Unconfirmed reports of dead birds
Human outbreaks, etiology unknown
Orange Oval = Sharkin, Udmurtia, Russia (fever, meningitis, gastro-intestinal)
Blue Oval = Tomsk, Tomsk, Russia (fever, meningitis)
Red Oval = Moklakap, Chita, Russia (fever, vomiting)
Your sarcasm is well taken, but this strain still lacks an efficient human to human transmission pattern. SARS would have been god awful if its transmission pattern was not for the most part attributable to fecal matter, nebulizer aerosols and some other still unknown [at least to me] pattern of transmission that made hospital workers terribly vulnerable.
Granted this is a flu variant and flu has a documented pattern of mutating and jumping species so the odds of a pandemic are much greater than the odds on SARS if you were "betting on the cum."
For what it is worth, my father spent a few days on deaths doorstep as a seven year old what the Spanish flu hit. Flu can be a big deal ... hopefully not this time.
I want my mommy!
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