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Thursday, 12 March 2020

Too much or too little?

We seem to be living in a strange situation where it is unclear (even the 'expert' advice seems to be somewhat inconsistent) as to what is the 'right' thing to do personally with regards to Covid-19. Do you panic and sell off stocks, or follow traditional advice to 'stay the course' and not try to time the market? If you have sold your portfolio, when do you start buying again? Do you join the growing ranks of 'panic shoppers' and stock up on non-perishable foods (thereby causing shortages for others that stick to their normal shopping habits), or follow the general advice to not panic buy/hoard? (All very well until travel restrictions and shop closures happen, like in Italy, or supplies aren't available when you need to get some). Should you believe those that are saying, basically, that 'there is nothing to fear but fear itself' (ie. the effects of a panic will kill more people than the corona virus itself), or those that say we are being too blase about Covid-19 (i.e. it's *not* 'just the flu')? (Given that when the WHO officially declared a pandemic overnight they made comment that "we are deeply concerned both by the alarming levels of spread and severity, and by the alarming levels of inaction." it seems that many people, even in government, have been not treating the situation seriously enough).

Personally I'm trying to take the 'middle road' (but erring towards caution). I'm still going to work (by bus and train), although my workplace did have half the workers test out 'work from home' yesterday, and the other half today - we'll find out next week if those that can 'work from home' are directed to do so. But I'm sitting (as much as possible) as far from others in the bus and if a train arrives fully loaded I'm giving it a miss and waiting five minutes for the next train. And today I skipped getting on a packed elevator at work and waited to get on the next (empty) one. At the shops I'm taking advantage of the disinfectant wipes provided and wiping down the trolley handle before starting to shop, and making sure I don't touch my face while 'out and about', and washing my hands for the recommended 20+ seconds when I get home (before touching anything around the house). And I'm generally trying to stay 1 meter clear of everyone as I walk around the shops, train stations, bus queues etc.

Over-reacting? Probably/maybe. Under-reacting (I'm still going to work even though I have enough accumulated leave to take a couple of months off work if I wanted to)? Possibly. But this is probably as good a time as any to err on the side of caution. After all, the NSW Health Minister has today suggested that 20% of the state's population (i.e. 1.5 million people) will catch Covid-19 (which, if the fatality rate is around 3% would mean 45,000 deaths). And Angela Merkel suggested that 60% of Germany's population (ie. about 50 million people) will catch Covid-19 there (which could mean an astounding 1.5 million deaths). While being extra cautious might only 'delay the inevitable', it will provide two major benefits - 1) the peak of illness will be lower and spread over a longer time period (allowing emergency health care to better cope - there are a finite number of ICU beds available, and limited scope to increase resources), and 2) at some stage (in 12-18 months?) a vaccine should become available, so having as few people as possible spreading Covid-19 in the interim will help reduce the number of fatalities overall.

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