The newly reported cases of Novel Coronavirus (COVID-19) in China appear to be tapering off, but it is the recent uptick of newly reported cases outside China that have reached alarming levels, resulting in total cases accelerating to just under 100,000:
The secondary round of infections, most likely from travelers from China before the largest quarantine in human history, is evident when one looks at the progress in the number of countries reporting confirmed infections, with a marked jump since 23rd February 2020, to just over 90 countries.
The time-lapse between China and rest-of-world infections is worrying scientists that the virus has gone largely undetected in the rest of the world, particularly 3rd world countries with immature health infrastructure. This may be due to delays associated with travel propagation, up to 14-day incubation period compounded by no visible symptoms during incubation, and delays in country preparedness and detection capability. Granted, many countries are reporting less than 5 cases, but the ballooning of infections recently in South Korea, Italy and Iran (apparently 8% of Iran parliament is infected) give an idea of the potential scale of this disease in individual 1st and 3rd world countries alike:
It would be foolish to assume reported confirmed cases constitute 100% of the sample set, so its a question of how much is being unintentionally unreported and intentionally under-reported. There are those that estimate China has purposely under-reported infection by 10-fold or even more.
The percentage of cases from China has been dropping steadily to just over 84% as infections spread faster outside China:
Given that China represents just 20% of the world population, and giving China the benefit of the doubt that they have indeed now contained the virus and we can believe their reported numbers and they top-out at 90,000 infections, we can make a best-case assumption that a global pandemic could easily surpass 500,000 infections.
With the current mortality rate at around 3.4%, this could imply 17,000 deaths globally:
The worst case assumptions are too ghastly to contemplate with many scientists saying up to 40% of the globe could be infected, resulting in over 100-million fatalities.
For market watchers, the concern is the out-sized economic effects of fear, panic, quarantine (almost 300 million students quarantined worldwide now), collapsed travel and tourism, plunging industrial production and world trade volumes and cascading disrupted supply chains.
With the global economy having looked like it was just emerging from a business cycle downturn in December 2019, the COVID-19 outbreak could be a real economic recovery spoiler, as shown from charts taken from our detailed December 2019 monthly Global Economy Report:
Even if the U.S manages to avoid an outbreak, their economy will not. Prior research shows that US leading economic data and indeed even stock market returns, have much higher-than-expected correlations to global economic conditions outside the U.S.
Also, with monthly leading US data looking vulnerable and future US recession probabilities in the 28-52% range, the US economy may not have enough buffer to avoid a local recession with a protracted continuation of the current global business cycle downturn:
If you are interested in tracking the daily progress of this virus outbreak, the best place we have found is here. Just be careful not to read anything into the current days numbers, as they adjust dramatically overnight as they are invariably incomplete. The prior days numbers are the ones to focus on.
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