COVID-19 Political, Economic & Social Ramifications

OpenTable data shows that cities that took social isolation seriously are showing a large drop in restaurant reservations, which could be an indicator that more people are starting to avoid public gatherings.

It seems that a response to a massive pandemic should come from the federal level. Instead, we had states, and individual organizations and local governments react first, in an unpredictable and uncoordinated manner, with little strategy.

Anti-science had happened throughout history, it's nothing new, and in the long run, science will find truth more than the fiction will.

Testing that is currently done on the patients is only focused on verifying if an active patient is infected with the SARS-CoV-2 virus. We are however not testing everyone for the signs of having been previously infected with this virus, which means we are missing the total number of infected population.

According to David, while PCR test, done on the currently sign patients, is time-consuming and expensive, we could be running another form of tests (IGG and IGM) that test for the presence of antibodies in the blood, testing whether someone had at all been infected. It is a much cheaper test that could be done instantly.

According to Chamath, now that Trump tapped into the private sector to help combat this virus, their success and failure is intertwined. Provided we are able to put the virus behind us without further complications, and Trum is able to secure an economic stimulus package to restart the economy, this will only aid Trump's re-election, showcasing him as a strong leader who got the job done.

Consumers consume what they want, and the media that provides the best fitting product is the media that wins. As a result, If we want to get news in 140 characters, that's what we get.

Meanwhile, science-based journalism is really hard as it requires prior knowledge and understanding of the subject. Journalist able to do this end up not doing well, as not many people will sit through a 30 minute article.

The consumer is the one to blame here.

There is a trial on the way to verify whether Remdesivir drug might an early intervention solution. Patient given this drug in Seattle recovered within a day.

[Editor's note] Here's an excerpt from the Sciencemag article - "Remdesivir cripples an enzyme called RNA polymerase that is used by many viruses to copy themselves; it does not specifically target SARS-CoV-2, the virus that causes COVID-19. But it worked well in test tube and animal studies of human coronaviruses."

Statistically, age of the population, smoking, and access to care seems to be the three key risk factors for this virus.

Italy has a problem with all three: a much older population that smokes a lot, and is now completely out of ICU beds to treat these patients.

Once enough people have gotten exposed to the virus and survived, they now have antibodies and are no long able to transmit the virus to other people. At certain point, once enough of a population has been exposed, the other part of the population ends up been safe from new transmissions.

Given Facebook's viral coefficient of 7, where for every one user joining Facebook there will be 7 more who join as well, Facebook is a great example of a viral growth of a diseases, and shows that in order to stop a virus, you have to stop it early enough.

If the objective is to minimize the number of people that die from this particular virus, the correct decision is to remain isolated. On the other hand, if the objective is to minimize the economic impact relative to the number of people that will die as a result of bad economic impacts, herd immunity might be a better solution. As a nation, we are simply making a decision to save people, despite the economic impact.

(1) Implement emergency protocols that removes bureaucratic guidelines and enable widespread testing.

(2) Get test production into US start using new technologies which enable instantaneous testing.

We have a policy to "do no harm," but instead we should be aiming to "do more good." For example, we could use a drug that might kill 2% of the people that take it, but 80% of the people who were otherwise going to die, would not live. That's a much better outcome, but we can't do it right now due to regulations.

We have the science and the manufacturing capacity to do it, but regulatory hurdles in America are preventing scientists from actually doing it. As a result, people do not have a choice to decide whether they want to use a certain drug or not.

Even Remdesivir, the drug that seems to be helping with Covid-19 and does not have any mortality associated with it, people cannot simply get it at the hospital.

"More people will die because of the second and third order effects of coronavirus." ~ Chamath.

All kinds of industries; airlines, cruises, hospitality, retail and then the non obvious, like software companies. As some business get impacted, their customers and their supplies will get impacted.

So this is the first time in a very long time where we're really going to see the domino effect of the economic contraction. This combination of a supply side shock and the demand shock.

Supply side shots can be fixed relatively quickly. It's the demand shocks that are much harder to recover from because they're deeply psychological in nature, they drive the leverage.

De-leveraging is going to be an important, probably violent and messy, leaving lot of people unemployed, a lot of businesses out of business closed.

Editor's note: Here's a tweet from Tim Draper, a successful venture capitalist, confirming this case.

As Chamath explains, most of the stock market participates today are playing with borrowed money, and everyone is happy to do it, as long as there is little volatility in the market. However, as the market becomes unpredictable, banks pull their credit and ask the hedge funds to show more cash. As a result, funds are forced to sell some of their assets, and the cycle perpetuates.

To make it even worse, most trades today are algorithmic, done by computers, and even if humans trying to intervene with decisions based on the understanding of current situations, the computers overpower and continue their course.

The most important thing in business is to not go out of business. The next couple of months are going to be unpredictable. Companies need to reduce their burn rate and prepare to see lower revenues. Raise more money if you still can. A downturn in a market is a great time to work on your company and get everything ready for when the market bounces back up!

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