How Serious is the Coronavirus?

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Everyone’s heard about it, we’re all in fear of it, but what exactly is the Coronavirus?

What is it?

Coronaviruses are a family of viruses in the same category as SARS and MERS. They originate from animals and are caused by animal-to-human contact.

They are feared because of their ability to cause more severe diseases such as pneumonia, which can cause death.

Here’s the comparison between each one:

This latest Coronavirus has been labelled 2019-nCoV, and originated in the Chinese city of Wuhan, most likely from a seafood market selling live animals for consumption.

So far, it has caused over 300 deaths and cases have popped up all over the world – US, Australia, Thailand, Philippines, Germany, Japan, South Korea to name a few.

Should I be worried?

In a word, yes.

But should you be hoarding tinned food and ammo?

No.

Why not?

Understandably, the spread of the virus outside China is worrying, but not unexpected.

The WHO (World Health Organization) has declared a public health emergency, which I take it to mean that there will be a “coordinated international response” in finding a treatment for the virus.

This, and increasing media attention has meant that politicians around the world are under the spotlight with what actions they are taking to contain the outbreak.

Who is affected?

Like most diseases, the young, sick or elderly are most susceptible to being transmitted.

Although the Coronavirus’ mortality rate sits at around 2%… there has been suggestions that it should be lower because of people’s ignorance of the symptoms (which are similar to a common cold) and hence do not seek hospital treatment, which means their cases are unrecorded.

As a guide, the flu has a mortality rate of around 1%, and causes over 400,000 deaths each year.

How does it relate to finance?

Well naturally, markets around the world are factoring in growth slowing down due to the impact on many industries, such as travel, tourism and retail goods.

Companies and stocks linked to China especially, have felt the brunt of market falls.

Additionally, given China’s place in the world economy (2nd largest), there are fears that this would also slow down the Chinese economy.

SARs ended up costing nearly $40 billion after killing almost 800 people. Thus far, using SARS estimates, this new coronavirus has cost the world nearly $3 billion.

What do I do?

You can’t do much expect to regularly wash your hands and cover your mouth when coughing or sneezing.

If you wanted extra precaution, there are increasing numbers of people wearing face masks walking around.

And if you wanted extra, extra precaution – just stay indoors and avoid contact with anyone.

When will it end?

No one knows the answer to that, but I honestly think we will look back on this as just another “thing” we had to deal with.

The media is doing its darndest to fuel the story, but that’s just what they do.

“Things” are always scary and uncertain at the time, but become just another event that occured in history.

That’s why it’s important to not get caught up in the media storm, apply critical thinking, have a poke around for the truth yourself, and then make a decision.

If you take this approach in investing, and in life, you should do OK on the other side.

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