Posted on 02/19/2020 6:44:53 AM PST by Kaslin
China's coronavirus disease 2019 (Covid-19) continues to take human lives. The Chinese people have suffered the most in terms of total cases and lives lost. The epidemic began in Wuhan, capital of the Hubei province. As I write this column, Hubei has had 60,000 confirmed cases and almost 1,800 deaths.
Covid-19, however, has escaped China's political borders. The World Health Organization's Feb. 18 Covid-19 "Situation Report 29" declared that 25 countries have clinically diagnosed Covid-19 cases, and many are laboratory-confirmed. As of Feb. 17, WHO had sent virus laboratory testing kits to 34 countries. Eventually, 56 countries will receive them.
WHO's Risk Assessment index rated the virus' global health threat level as "High."
Though it is no economy killer, Covid-19 does threaten the world's economic vigor. That is not a surprise. The current trade war between the U.S. and China has only begun to decouple their economies.
China's communist government must import natural resources (oil and minerals) to keep its industry humming. It also imports some foodstuffs that have domestic political impact. Since a swine virus devastated its pig farms, China relies on U.S. pork to appease the palates of its oppressed but increasingly restless citizens.
In the last three weeks, a spate of corporate and governmental announcements shows the U.S. and Chinese economies remain entwined.
For example, Apple warned investors that the coronavirus epidemic will prevent it from meeting first-quarter profit expectations. Domestic Chinese demand for Apple products has declined sharply. The epidemic has also disrupted iPhone production in China. Apple remains a blue chip company, but it faces demand and supply chain problems.
The epidemic has also disrupted the world's largest mobile phone industry trade show, the Mobile World Congress. On Feb. 12, the MWC decided to cancel its annual Barcelona conference. Fear the disease may spread is one reason, but travel restrictions from East Asia would have reduced attendance.
On Feb. 14, The Wall Street Journal examined the epidemic's effect on auto industry manufacturing. Once again the big factor is supply chain disruption. Hyundai and Renault have slowed production on selected assembly lines in South Korea. Fiat-Chrysler is halting car production at its factory in Kragujevac, Serbia, because the facility relies on Chinese-made parts. North America is not decoupled. The Journal quoted a United Automobile Workers source who warned that General Motors' Arlington, Texas, assembly plant may face a shortage of Chinese-made components.
The Chinese National Immigration Agency has reported that 133 countries have imposed entry restrictions on Chinese citizens or individuals who have visited China. For health reasons, the quarantines are mandatory and must be enforced. But they exact economic costs, obvious and hidden. For example, Chinese companies operate several globally important mines in the Democratic Republic of Congo. Typically, Chinese nationals fill the critical skilled-worker positions. Movement restrictions could "extend the timelines" for manufacturing projects relying on Congolese minerals from Chinese-operated mines.
A recent Reuters report provided a superb example of economic disruption attributable to a quarantine. The state-owned China Railway International Group's high-speed rail project in Indonesia is one of Beijing's marquee Belt and Road Initiative megaventures. Key managers and technical workers who went to China for the Chinese New Year cannot return to Indonesia. The project now faces major delays.
The virus bugs the oil business, with Iran a definite loser. China has been Iran's biggest buyer, importing roughly 300,000 barrels a day in 2019. Reduced economic activity lowers China's demand for oil. According to The Wall Street Journal, U.S. government officials attribute some of China's decline in demand to the domestic transit restrictions. People can't travel.
Thus, Covid-19 exacerbates Iran's economic maladies. Are the ayatollahs blaming their best customer? No, they will find a way to blame America for the disease.
Imprison and re-educate Uyghurs, buy oil from Iran. No cognitive dissonance.Bring Out Your Dead
Post to me or FReep mail to be on/off the Bring Out Your Dead ping list.
The purpose of the “Bring Out Your Dead” ping list (formerly the “Ebola” ping list) is very early warning of emerging pandemics, as such it has a high false positive rate.
So far the false positive rate is 100%.
At some point we may well have a high mortality pandemic, and likely as not the “Bring Out Your Dead” threads will miss the beginning entirely.
*sigh* Such is life, and death...
If a quarantine saves just one child's life, it's worth it.
Personally, I don’t see how it hurts our economy if we have to make everything here again but I don’t have a degree in economics.
AO-C does, and she knows nothing about the law of supply and demand!
If you did you wouldn't see the forest for the trees.
1. We can’t build enough factories and get enough production machinery installed quickly enough to make up for the loss of Chinese parts and materials supply.
2. We can’t hire enough people quickly enough to man those factories we can’t build. We are already at full employment. Many existing industries simply cannot hire all the people they need.
3. CFOs are reluctant to make investments in #1 and #2 unless they are certain that those are good long-term investments. If China beats this virus and bounces back quickly, American companies will have wasted lots of capital and hired people they don’t need.
It’ll hurt us in the short term because A) we have lost market in China and B) we have material and parts shortages. It might help us in the long-term if we believe we can beat the Chinese with lower prices and better quality after they get over COVID-19.
It is a tough risk analysis and financial returns game being played out right now in board rooms all over the country.
Total BS. You are globalist loser. Go away. WE NEED REALLY HIGH PROTECTIVE IMPORT TARIFFS NOW!
Our grandparents won simultaneous wars in Europe and the Pacific in 4 years.
Dear World,
Economic vigor is fine in the USA... MAGA!
It would cause some inflation but huge gains in GDP and per capita income. Also a baby boom as life got a little easier for the youngin's.
We need tariffs on specific products and not from country of origin. There should be a 100% tariff on medical equipment/supplies. This will FORCE our “captains of industry” to make it HERE!
If globalist Free Traitors™ were summarily shot and thrown in unmarked graves I’d have a hard time shedding tears.
The EPA's ban on CFCs forced the chipmaking industry to move permanently offshore. There are many, many other examples of laws and regulations passed at the behest of the Left that will have to be repealed or abrogated for manufacturers to return to the USA in large numbers.
You can't force manufacturing to come back when it remains illegal to manufacture so many products here. Companies may be forced to abandon ill-advised joint ventures with China, but they have to then go to Vietnam or India or someplace else without Elizabeth Warren-like scolds occupying positions of influence.
A quick search yields much of nothing with respect to products illegal to manufacture in the USA.
Do you have a source?
Single point of failure is never a good idea.
Allowing an adversary to produce all your machine parts, computers, and medicine is suicide.
Go hump your Pandas somewhere else.
“Allowing an adversary to produce all your machine parts, computers, and medicine is suicide.”
Bears repeating.
25% tariff on all Chinese products now! Also, tear up Phase I. China is proving itself once again to be a bad actor with its censorship of WuFlu information.
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