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In the USA we have had a forceful reminder that there is an incompetent and lying Government in place federally which is being exposed by a health system which is seemingly heading for a very inglorious failure to even remotely handle COVID-19 as it spreads. Trump has confirmed he is an utter fool with his behaviour on this issue. Sadly Mike Pence is probably worse!
In the UK the virus is also off and running and causing havoc sadly. Hard to know how it will all evolve.
In Australia the virus is running away and we are seeing a major focus on the economic damage and the risk of recession, which is seemingly becoming more likely.
I am sorry there is so much on COVID-19 but this is an evolving, global and worrying story - to say the least.
I am sorry there is so much on COVID-19 but this is an evolving, global and worrying story - to say the least.
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Major Issues.
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Baked beans are out, overseas travel is in: changing expectations of retirement
By Jessica Irvine
March 1, 2020 — 12.00am
Australians worry about their fortunes in retirement. Few realise the concept of “retirement” itself – a period of respite after a life of work – is a relatively recent invention.
When Australia’s federal age pension was first introduced in 1909, it came with a qualifying age for men of 65. The average life expectancy for a boy born that year? Age 55. So, on average, Aussie men were expected to drop dead well before they ceased work and qualified for the payment.
Fast forward to today, and Aussies are living longer – well into their 80s – while the pension qualifying age remains largely unchanged.
The vanguard of the Baby Boomer generation – those born in 1946 – began qualifying for the pension in 2011 and will spend longer in retirement than any previous generation.
Expectations of retirement have changed. Baked beans and chintz sofas are out. Yoga and overseas travel are in.
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Paul Fletcher warns laws must change to save local film and TV from 'sharp declines'
By Fergus Hunter and Zoe Samios
March 2, 2020 — 12.00am
Communications Minister Paul Fletcher has warned current Australian regulations are condemning local film and TV to sharp decline and must be updated to help content producers hold their own in the era of global streaming services.
The government is considering the future of Australian content obligations and whether streaming platforms should be subject to the same rules, as free-to-air broadcasters including Seven West Media and Nine Entertainment Co threaten to stop creating programs that fall within current guidelines.
Mr Fletcher said the Australian film and TV sector had an opportunity to capture a share of the growing international market for content fuelled by the rise of Netflix, Disney+, Amazon Prime and other services. The platforms boast 500 million subscribers globally, with the number expected to double in the next five years.
Research from Media Partners Asia estimate Netflix Australia has 5.6 million subscribers and Disney+ has 1.2 million as of February. Last week Nine reported Stan had 1.8 million subscribers.
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Productivity problem? Start at the bottom, not the top
Ross Gittins
Economics Editor
March 2, 2020 — 12.00am
Whenever we’re told we’re not achieving much improvement in our productivity, a lot of people assume it must be something the government’s done – or more likely, failed to do. Such as? Isn’t it obvious? Failed to cut the tax on companies and high income-earners.
But though the national rate of productivity improvement is merely the sum of the performances of all the industries that make up the economy, no one ever imagines the problem might be something the nation’s businesses have been failing to do.
This, however, is where a lot of research is pointing, as summarised by the Labor shadow minister and former economics professor, Dr Andrew Leigh, in a recent speech. He starts by explaining that productivity measures how efficiently the economy turns labour and capital into goods and services.
"Last year, Treasury’s Megan Quinn revealed that researchers in her department, led by Dan Andrews, had been investing in a new analysis that links together workers and firms, and delving into fresh data about the dynamics of the Australian economy," he says.
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How declining productivity weakened our economic immune system
It’s hard to imagine a bigger week for the Australian economy: China’s manufacturing index has fallen off a cliff because of the coronavirus, we have the RBA meeting Tuesday and December quarter national accounts on Wednesday.
China’s manufacturing PMI fell to a record low of 35.7 in February, from 50 in January, and the non-manufacturing PMI fell even more – from 51.1 to 29.6.
Australia’s major trading partner has come to a standstill so exports to it have too. Wednesday GDP won’t record that, but everyone knows what’s coming when March quarter GDP is published in June – it will be negative. The only question to be answered is whether it will be two quarter negative quarters, and therefore a recession, and it’s hard to see how that can be avoided.
China has become the fulcrum of the global trading system and it’s not just its demand that has collapsed, but its supply as well. Global businesses selling almost any product are running out of stock. And as other countries shut up shop in response to their own coronavirus cases, a global recession becomes more and more inevitable.
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Super system out of balance, says Grattan Institute
9:00PM March 1, 2020
Australians are saving enough for retirement but the federal government must encourage drawdown of savings if there is any hope of balancing Australia’s retirement system, the Grattan Institute says in its submission to the Retirement Income Review.
Retirement income policy is set on the assumption that savings will be consumed, yet many Australians do not draw down on their retirement savings.
“Many retirees are consuming much less than is implied by the purported aim of the system to smooth consumption over the lifetime,” the report said.
Grattan Institute Program Director for Household Finances Brendan Coates said the superannuation system was in need of a serious review, 27 years after it was set up.
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Afghan war has cast the longest shadow
After almost two decades and at a cost of $US2 trillion ($3.07 trillion) and 100,000 lives, the US-NATO-led war in Afghanistan has come to an end with the signing of a peace deal with the Taliban.
Few things in Afghanistan move fast. Its ancient mountain terrain mirrors the lines of history etched into the faces of its people. Even watches become impatient here.
The question is not whether the Taliban can be trusted (that’s obvious) but whether outsiders will stop interfering in Afghanistan to allow peace to hold. Let’s also remember the Australian soldiers who sacrificed so much.
The next phase involves reconciliation between the Taliban and Afghanistan President Ashraf Ghani’s administration. The Taliban utterly rejects the Afghanistan government and ultimately may seek to topple it.
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AMP's De Ferrari says red tape will cause recession
AMP is at the pointy end of a wave of increased regulation. Now its chief executive is calling out the unintended consequences, including a possible recession.
Mar 3, 2020 — 12.00am
In one of the boldest calls made by a business leader in a very long time, AMP chief executive Francesco De Ferrari says excessive regulation will ultimately contribute to a recession in Australia.
In an exclusive interview with Chanticleer, De Ferrari says the lack of political leadership and regulatory overload have created a moral hazard that poses a risk to the financial system.
"Sorry to be extreme, but I don't think people are watching the same movie as the one I'm watching," he says.
"In the movie I'm watching, this country hits a recession.
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AAP to close after wire service tells staff it is no longer viable
Chief executive of Australian Associated Press says the news agency, which has operated since 1935, is closing on 26 June
Tue 3 Mar 2020 14.11 AEDT Last modified on Tue 3 Mar 2020 15.36 AEDT
News agency Australian Associated Press will close in June after major shareholders Nine Entertainment and News Corp Australia said the 85-year-old institution was unsustainable.
The AAP chairman, Campbell Reid, described the newswire as Australian “journalism’s first responder”.
“It is a great loss that professional and researched information provided by AAP is being substituted with the un-researched and often inaccurate information that masquerades as real news on the digital platforms,” Reid, who is News Corp’s group executive corporate affairs, told staff at a meeting in the Sydney newsroom.
AAP provides more than 500 stories, 750 images and 20 pieces of video each day across news, politics, finance and sport to some 200 subscribers who use it for newspapers, radio news and talkback programs, television news and websites.
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The drought was an opportunity, not a crisis
If Australia is to become a global agricultural superpower, weak farms need to be allowed to fail.
Mar 4, 2020 — 10.30am
In the cultural and emotional-driven debate about the fate of Australian agriculture, harsh realities are reserved for the animals whose owners are unable to keep them alive.
This week, the most comprehensive data available demonstrated, once again, that while the drought was painful for many, it did not constitute a crisis at the national level.
Despite four years of little rain in parts of NSW and southern Queensland, high prices and robust production will generate $153,000 profits this financial year for the average Australian farm, a sum just 4 per cent below the 10-year average, according to a quarterly report by the Department of Agriculture's economic forecaster, the Australian Bureau of Agricultural and Resource Economics and Sciences.
"Australia's agricultural sector has been remarkably resilient in 2019–20 despite prolonged drought and widespread bushfires," the agency declared at the start of its annual conference in Canberra this week.
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Panic tests the trust of nations
In infected countries the spread of the virus is driving a wedge between citizens, governments, and the rest of the world.
Mar 4, 2020 — 12.00am
For the Australian citizens in Wuhan, it came down to trust. Those citizens who took up the offer to be evacuated to quarantine in the Christmas Island refugee processing centre trusted the Australian government over the Chinese government.
As the novel coronavirus spreads across the globe, trust between citizens and government, between neighbours, and between neighbouring nations is being tested.
The virus is revealing and exacerbating existing national and international tensions. The Schengen dream of a borderless Europe has been under strain over the past few years; Brexit was only the most visible revolt against its supranational vision. Now the borders of Europe are creeping back into place, this time in the name of public health.
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Journalism just suffered another thousand cuts with the death of AAP
When I first walked through the doors of AAP’s old head office beside Sydney’s Wynyard station in July 1972, the first thing that struck me was the noise.
In a spartan room with a low ceiling, more than 100 teleprinters were going hammer and tongs, receiving news from across the world and sending foreign and domestic news across Australia, including to its Antarctic bases, and even to ships at sea.
Each of them was driven by precisely-rolled coils of perforated paper tape — the fabled ticker tape once showered on parades on Wall Street.
At desks surrounded by banks of those infernal, clacking machines sat a few dozen men — there were no female journalists back then — adding to the din by banging at typewriters and shouting into telephones.
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PM, we have a problem with Houston ... and the pillars of democracy
Jacqueline Maley
Columnist and senior journalist
March 8, 2020 — 12.00am
Why did Scott Morrison finally admit this week he sought to have Hillsong pastor Brian Houston invited to a state dinner at the White House? For months he refused to answer questions about it, following a Wall Street Journal story on the matter.
In September 2019 the WSJ reported that Morrison was “determined” to bring Houston but “after several rounds of discussions across the 14 time zones between Washington and Canberra, Mr Morrison agreed to leave the pastor at home, according to several people familiar with the matter”.
At the time Morrison dismissed the White House leak as “gossip”, Canberra-bubble stuff, and refused to say whether it was true. He didn’t lie, but he also didn’t tell the truth.
On Tuesday, grilled by Ben Fordham on 2GB over the matter, he finally admitted it. “We put forward a number of names that included Brian,” he said. “I have known Brian for a long time and the Hillsong Church has a very big network all across the United States.”
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Shoppers: the canaries in the economic coal mine
By Shane Wright
March 6, 2020 — 5.04pm
It's hard to over-emphasise the importance of the Australian household to the health of the national economy.
While we celebrate farmers and their fields of wheat, miners and their ships of iron ore or companies like Cochlear and their amazing technologies, the economy really rests on people and their day-to-day spending.
This week's December national accounts, for instance, showed two-fifths of the 0.5 per cent expansion in the economy was due to increased household spending.
That's why Friday's January retail sales data, showing a 0.3 per cent drop on top of a 0.7 per cent fall through December, is a canary in the economic coal mine.
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Religious bill debate shows we’re off to court
MARK FOWLER
The Morrison government’s draft religious discrimination bill has become a lightning rod, unmasking the full extent of polarisation between religious and anti-religious views in Australia. Most of the furore has focused on the bill’s protections of free speech. The debate lays bare just how fractured our societal fabric is when it comes to matters of faith.
Australian settlement came shortly after, and in many respects was shaped by, the first flares of Enlightenment reason. Central to liberal philosophy is the oft-cited axiom attributed to Voltaire: “I disapprove of what you say, but I will defend to the death your right to say it.” However, in a less frequently cited remark made towards the end of his life, on the mere mention of Jesus Christ, Voltaire exclaimed: “Do not speak of that man here.” The protagonists in the current debate appear intent on ensuring it is their preferred version of Voltaire that prevails.
State-based protections against religious discrimination have been law since the 1980s and have not garnered anywhere near the level of contention created by this bill.
This is primarily because the Ruddock review proposed this bill as an answer to the question, asked at the height of the same-sex marriage debate, of whether religious freedom was adequately protected in Australia. As a result, supporters and opponents of the bill both conceive of it as enshrining a new settlement between secular and religious views in this nation.
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Bushfire Crisis And Climate Policy
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Warm winter crushes German ice wine crop
March 2, 2020 — 6.26am
Frankfurt: A warm winter means that for the first time in years Germany's vineyards will produce no ice wine - a pricey, golden nectar made from grapes that have been left to freeze on the vine.
The German Wine Institute said on Sunday that none of the country's wine regions saw the necessary low temperature of minus 7 degrees Celsius.
A succession of warm winters have cut into ice wine production recently, the institute said, noting that in 2017 only seven producers managed to make it, and only five managed it in 2013. The institute, the wine industry's marketing arm, didn't say how far back records went.
"If warm winters become more frequent over the coming years, ice wines from Germany's regions will will soon became an even more expensive rarity than they already are," said wine institute spokesman Ernst Buescher.
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Coronavirus And Impacts.
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Coronavirus lockdown in China has air pollution levels tumbling, NASA satellites reveal
March 1, 2020
Air pollution over China has plummeted in the wake of the coronavirus outbreak that forced the shutdown of industry and transport, NASA says.
NASA and the European Space Agency's pollution monitoring satellites have detected a significant decline in the amount of nitrogen dioxide (NO2) — a noxious gas emitted by cars, power plants and factories.
"There is evidence that the change is at least partly related to the economic slowdown following the outbreak of coronavirus," NASA said in a statement.
According to NASA, the reduction in NO2 was first apparent near Wuhan, the epicentre of the virus, where millions of people were quarantined.
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How the COVID-19 outbreak is changing global politics
Updated Mar 1, 2020 — 2.22pm, first published at 2.21pm
London | There is a plaque in the English seaside town of Weymouth which records, matter-of-factly: “The Black Death entered England in 1348 through this port. It killed 30-50 per cent of the country’s total population”.
International epidemics are a centuries-old phenomenon that have often changed the course of history. The Black Death, which some believe originated in China and others trace to the Crimea, caused devastation across Europe — bringing social, economic and political turmoil in its wake. Centuries later, it was European explorers who carried new diseases across the Atlantic — creating epidemics that decimated indigenous populations in the Americas.
Since the coronavirus appears to have a mortality rate of around 2 per cent it will not have the impact of history’s worst pandemics. But, for a modern society, the worst-case scenarios are still shocking. last week a leaked British government estimate outlined an extreme case in which 80 per cent of the UK public is infected, leading to 500,000 deaths.
Professor Marc Lipsitch of the Harvard TH Chan School of Public Health has predicted that between 40 and 70 per cent of people worldwide are likely to be infected in the coming year — although many will have only mild symptoms or none at all.
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Markets seek comfort from RBA
Updated Mar 2, 2020 — 9.24am, first published at 12.00am
The federal government and financial regulators are co-ordinating an emergency economic response to the coronavirus crisis, starting with a possible interest rate cut on Tuesday by the Reserve Bank of Australia.
Prime Minister Scott Morrison, Treasurer Josh Frydenberg and the heads of financial regulators spent the weekend in phone hook-ups to prepare Australia’s economic defences against the virus that has shaken global financial markets and slowed China's economy to a virtual standstill.
China’s official manufacturing purchasing managers’ index (PMI) contracted to a record low of to 35.7 in February, from 50 in January, as the closure of major industrial factories around the epicentre of the crisis in Wuhan took its toll on Australia's largest trading partner.
The Council of Financial Regulators is due to convene on Monday. The talks will be led by Reserve Bank governor Philip Lowe and involve the heads of the Australian Prudential Regulation Authority, Australian Securities and Investments Commission and Treasury.
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https://www.afr.com/politics/federal/wa-man-first-australian-to-die-from-coronavirus-20200301-p545r6
WA man first Australian to die from coronavirus
Mar 1, 2020 — 1.05pm
A Perth man who travelled on the Diamond Princess cruise ship has become the first Australian to die from the COVID-19 coronavirus as the nation and business brace for more bad news.
The78-year-old was being treated at the Sir Charles Gairdner Hospital in Perth.
The death comes days after the federal government initiated pandemic plans and as Health Minister Greg Hunt warned further cases in Australia were "almost inevitable".
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Leaning in to software to cope with outbreak's toll
Microsoft may be expensive. But when a company has a product that will sell, no matter the crisis, it is a company worth paying for. Software will prove to be that product.
James White
Mar 1, 2020 — 11.59pm
The coronavirus outbreak prompts a natural inclination to wait and see. Or to declare that there is little to know about what the future holds. Such uncertainty leads to the kind of market reaction seen in the last week: sell everything and start again.
In the GFC it seemed useful to consider John Steinbeck’s emblematic novel of the Great Depression: The Grapes of Wrath. On consideration, however, technology in 2008 could condense the 464 pages of Steinbeck’s classic to a couple of chapters.
Rather than a slow and uncertain journey across America; the modern journey of the American economic migrant would be simpler and shorter with jobs found online and the country crossed by air. Technological change facilitated a faster adjustment in the economy.
Today, as the impact of the coronavirus is considered, it’s again useful to think about the role of technology in coping with the challenge of a potential pandemic. In a world where contact and global travel is to be limited; software presents the greatest opportunity for businesses to adapt. This makes it interesting that software has underperformed the broader market in the last week.
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As stockmarkets tumble because of coronavirus, this time feels different
By David J. Lynch
March 2, 2020 — 8.30am
On Friday, Wall Street fell for the seventh straight day to end the week, with the Dow Jones industrial average losing 357 points, or 1.4 per cent, to close at 25,409. Only by staging a late rally in the final 15 minutes of trading was the Dow able to avert its third daily loss this week of more than 1,000 points.
The sustained selloff, driven by fears of global economic damage from the spreading coronavirus, prompted both the Federal Reserve and the White House to hunt for possible remedies, eyeing tools they have used during past crises to calm the public.
The traditional tactics, however, may not work against a financial panic driven by a global health scare that lacks precedent or antidote.
A sign of the crisis-fighting difficulties ahead came late on Friday, when Federal Reserve Chairman Jerome Powell issued an unusual statement vowing to "act as appropriate" to defend the US economy from the outbreak. Many analysts interpreted the statement as a pledge to cut interest rates, a signal that often heartens investors. But this time, the selloff continued.
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We’re too selfish to stop coronavirus spreading
· The Times
Where is the needle flickering on your coronavirus-o-meter: horizontally relaxed? Mild concern? End-of-days panic?
Last week I was snorting at a Mumsnet user’s list of the essentials she was stockpiling in case of a long period in isolation: “olive oil, hummus, body lotion, Pringles . . .” By the weekend I was eyeing the tinned goods aisle.
The World Health Organisation says the window of opportunity to contain the virus is narrowing. Mecca is closed to foreign pilgrims, Venice has pulled the carnival, Iran cancelled Friday prayers.
I am reassured by friends’ predictions that this will be another here today, gone tomorrow Sars or swine flu; then I remember they know as much about pandemics as I do about quantum computing.
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Disease management returns to the Middle Ages
Donald G. McNeil Jr.
Mar 2, 2020 — 4.35pm
There are two ways to fight epidemics: the medieval and the modern.
The modern way is to surrender to the power of the pathogens: acknowledge that they are unstoppable and to try to soften the blow with 20th-century inventions, including new vaccines, antibiotics, hospital ventilators and thermal cameras searching for people with fevers.
The medieval way, inherited from the era of the Black Death, is brutal: close the borders, quarantine the ships, pen terrified citizens up inside their poisoned cities.
For the first time in more than a century, the world has chosen to confront a new and terrifying virus with the iron fist instead of the latex glove.
At least for a while, it worked, and it might still serve a purpose.
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We can't keep virus out: Aussie medical chief
Mar 2, 2020 — 2.48pm
Australia can no longer keep new coronavirus cases out of the country, the nation's chief medical officer has said.
Professor Brendan Murphy made the comment while explaining why Australia has banned arrivals from virus-hit Iran, but not two other major hotspots, Italy and South Korea.
"It is no longer possible to absolutely prevent new cases coming in, given the increasing changes in epidemiology around the country," Professor Murphy told reporters on Monday.
He said the Iran outbreak was considered high risk, and the travel ban was considered an effective strategy to slow the spread of the disease.
But a different view has been taken on Italy and South Korea, where outbreaks are considered contained, confined and localised.
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We are facing a global recession and central banks may not be able to come to the rescue this time
Stephen Bartholomeusz
Senior business columnist
March 2, 2020 — 12.30pm
In 2008 central banks slashed interest rates and pumped massive amounts of liquidity into the world’s financial system to prevent a financial crisis from developing into an economic crisis. Could their intervention contain the economic damage of the coronavirus?
In 2008 they were partly successful. The world did suffer a recession and remains in low-growth mode more than a decade later but the central bankers and their governments staved off the depression that might have ensued had they not responded so aggressively.
With the fallout from the coronavirus, COVID-19, continuing to spread, there is a question mark over whether monetary policies can have anything like the same impact or, indeed, any meaningful impact at all.
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Virus could kill up to 100,000 Australians
Mar 3, 2020 — 10.12am
Economist Warwick McKibbin estimates up to 68 million people will die from the coronavirus, including as many as almost 100,000 Australians.
Preliminary economic modelling based on past viruses by Professor McKibbin suggests the loss to Australia's economic output will be between $US4 billion ($6.1 billion) and $US103 billion ($157 billion) in the first year, depending on how the virus spreads and interventions by global health authorities.
The local economy's annual gross domestic product (GDP) loss would be between 0.3 per cent and 7.9 per cent in 2020, if a pandemic breaks out.
Professor McKibbin, a former RBA board member now on assignment at the Brookings Institution in Washington, said that even a contained outbreak could "significantly impact" the global economy in the short run.
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The economy will bounce back. But when and at what cost?
The operating assumption is to prepare for this crisis to last until Christmas. The hope is it will end earlier. Ministers and their staff are being advised to manage their workloads so as to avoid burnout.
Mar 3, 2020 — 12.00am
Scott Morrison and Josh Frydenberg like to assure us the economy will bounce back as soon as the coronavirus crisis passes. They are right. What they cannot predict is when that might be.
As the Prime Minister and Treasurer repeatedly remind us, this is a health crisis with economic consequences. It is not like the global financial crisis, in which entire economic systems failed and required a structural rebuild.
It is like the SARS and MERS outbreaks which caused similar, but far less severe disruptions. When the threat passed, it was quickly back to business.
But with the coronavirus, the mood inside government is one of digging in for the long haul.
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Investment banks, tech giants go digital as virus spreads
Mar 2, 2020 — 4.43pm
Globetrotting investment bankers and big tech executives are in lockdown as the coronavirus crisis escalates, with travel bans put in place across the sectors and high profile conferences cancelled.
As alarms continued to be raised on Monday on the economic and health toll of the pandemic, global investment banks operating in Australia lamented the impact of COVID-19 response plans on their operations and clients.
"We have restricted business travel across the Asia-Pacific region," UBS head of human resources Gary Clayton told The Australian Financial Review.
"Our key concern is obviously the safety of staff, clients and families. Our bankers are working closely with clients to ensure that anyone who may be invited to our conferences or meetings and has visited high risk locations take the opportunity to not attend."
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Unprecedented limitations on movement, event bans loom
Mar 3, 2020 — 9.10am
Australians could face unprecedented limitations on their movements and the shutting down of public events, as the federal government prepares for a steep increase in COVID-19 coronavirus cases.
Attorney-General Christian Porter said biosecurity control orders could be used on a large scale around the country, with "human health response zones" and compulsory decontamination orders likely.
The powers to control individuals' movements and limit access to some public places were included in laws passed by Parliament in 2015, but haven't been widely used other than at international arrival points.
Mr Porter said implementation of the laws would be "strange and foreign" for many people, but warned the development was very likely in coming weeks.
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Australia faces big economic hit from virus as rate cut looms
By Shane Wright and Eryk Bagshaw
March 2, 2020 — 9.00pm
Australia will be one of the countries worst affected by the economic fallout from the coronavirus, slashing growth by at least half a percentage point, amid expectations the Reserve Bank will deliver an emergency interest rate cut to protect the economy.
The widening crisis has forced the government to look at targeted economic assistance for affected industries as internal doubts grow that they will be able to deliver a surplus amid an economic downturn. Accelerated income tax cuts and further stimulus payments are now on the table.
Local health authorities are racing to contain the threat of the virus locally after NSW announced the first case of person-to-person transmission in Australia, escalating the epidemic to its next stage as officials warn the public to stop shaking hands.
First person-to-person transmission of the coronavirus in Australia. Press conference with NSW Chief Health Officer Dr Kerry Chant and NSW Health Minister Brad Hazzard
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Coronavirus could set off a dangerous chain reaction in markets
By Ambrose Evans-Pritchard
March 3, 2020 — 12.15am
A swathe of highly indebted companies face an incipient funding shock and risk being shut out of the capital markets as the COVID-19 epidemic mushrooms into a global crisis, Standard & Poor's has warned.
There are mounting risks of a credit crunch in vulnerable sectors of the corporate bond market, which could rock an unstable financial edifice with record levels of debt and set off a dangerous chain reaction.
"Could this be the straw that breaks the camel's back?" said Paul Watters, S&P's head of credit research for Europe and the Middle East.
"The market has suddenly woken up and realised that this is no longer just a China story and we may be going into a global pandemic. Clearly the view two or three weeks ago that this would peak in March is no longer appropriate. The question becoming very relevant is 'which companies are going to be able to refinance?'" he said.
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'Diversified' portfolio can ride out coronavirus: Future Fund
Mar 3, 2020 — 12.14pm
The chief investment officer of the $168 billion Future Fund says the coronavirus impact is a "significant" economic event, and emphasised the importance of a well-diversified investment portfolio to ride out the financial market instability.
Speaking to a Senate committee in Canberra, Raphael Arndt talked up the sovereign wealth fund's ability to weather the financial storms in equities, bonds and private asset markets.
Dr Arndt said the federal government investment fund was "thinking very hard" about the impact of the coronavirus, including on Australia's largest trading partner, China.
"The impact of the virus is clearly significant, particularly on the Chinese economy," he said.
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Beware the virus bounce: The global economy is still very sick despite the sharemarket rally
Stephen Bartholomeusz
Senior business columnist
March 3, 2020 — 11.30am
Three anodyne sentences from the Federal Reserve Board chairman at the weekend and the news that G7 finance ministers will hold a teleconference today was all it took to ignite a sharp rebound in stockmarkets overnight. All’s well with the world, then.
Not really. Even as Wall Street was bouncing 4.6 per cent in response to Jerome Powell’s statement that the Fed would "act as appropriate" and that the G7 ministers would hook up by telephone the OECD was cutting its forecast for global growth this year from 2.9 per cent to 2.4 per cent.
If that were borne out it would be the weakest growth since the financial crisis. Things could, however, get worse.
The OECD also said that if the coronavirus didn’t peak this quarter – if it were longer-lasting and spread throughout Asia, Europe and the US – the economic impact would be severe, with global growth of just 1.5 per cent and the prospect of recessions in economies including Japan and the eurozone.
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The next global recession could be around the corner
The odds of a supply-side recession that brings inflation back from the dead have now risen more than anyone cares to say.
Mar 3, 2020 — 4.40pm
It is too soon to predict the long-run arc of the coronavirus outbreak. But it is not too soon to recognise that the next global recession could be around the corner – and that it may look a lot different from those that began in 2001 and 2008.
Unlike the two previous global recessions this century, the new coronavirus, COVID-19, implies a supply shock as well as a demand shock.
For starters, the next recession is likely to emanate from China, and indeed may already be underway. China is a highly leveraged economy; it cannot afford a sustained pause today any more than fast-growing 1980s Japan could.
People, businesses, and municipalities need funds to pay back their outsized debts. Sharply adverse demographics, narrowing scope for technological catch-up, and a huge glut of housing from recurrent stimulus programs – not to mention an increasingly centralised decision-making process – already presage significantly slower growth for China in the next decade.
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With chefs idle and vegetables rotting, China’s virus-hit restaurants say their goose is cooked
March 3, 2020 at 9:05 a.m. GMT+11
BEIJING — In the remote subtropical hills of southwest China, 80 miles from the Laotian border and 1,200 miles from the heart of the coronavirus outbreak in Wuhan, Yao Tonghua is facing a serious cash crunch.
Yao borrowed heavily two months ago to put down $10,000 for a five-story building she hoped would become a palace of Sichuan cooking. Then came the epidemic. Her seven cooks now lounge around empty tables meant for 100 diners. Vegetables rot in the yard. Fish bob inside tanks, neglected.
“I thought the disease was confined to Wuhan and would have little impact on a small and far-flung city like ours,” said Yao, who is contemplating laying everyone off and selling the restaurant to stem mounting losses but is worried she wouldn’t find a buyer. “This is getting more and more hopeless by the day.”
Several weeks into an epidemic that brought the country to a standstill, Chinese officials and economists are increasingly worried about the devastation wrought on a crucial part of the economy: restaurants and retailers, karaoke halls and family-owned factories — countless small and midsize businesses that collectively employ 80 percent of China’s workers and produce 68 percent of the country’s business revenue.
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Powell's shock rate cut misfires
Even financial markets aren't buying the deluded idea that monetary policy is the best tool to fight the coronavirus.
Updated Mar 4, 2020 — 8.20am, first published at 5.55am
Washington | Panic. Whatever you do, don’t do that.
Jerome Powell wants you to know that his stunning unscheduled mid-morning rate cut - 30 minutes after Wall Street opened sharply down on Tuesday (Wednesday AEDT) and the Fed's biggest policy move since the financial firestorm of 2008 - is about insurance.
It’s not an emergency. Got it?
Yet if the Fed looks and sounds a little desperate or muddled, it’s not really all their fault.
This is the world we now live in. Whenever something bad happens - pretty much anything it now seems - it's up to the Fed and the Reserve Bank of Australia and all the other central banks to act.
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Virus could delay apartment completions by up to six months
Mar 3, 2020 — 4.21pm
Completions of residential development projects could be delayed by up to six months as shipments of building materials from China are held up due to the coronavirus outbreak.
Mark Bainey, chief executive officer of Capio Property Group, said that while his company's projects were unaffected by the building supply delays, other developers — particularly the bigger ones — were likely to suffer delays in completing their projects.
"If there's delay in obtaining the materials from China, for the builders to source that somewhere else will push back the completion dates," he said.
"We may see delay in building completions for up to six months, which will also postpone bank settlement. This is going to cost developers more money and profitability."
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Virgin Australia among debt-bloated companies the virus threatens to drag down
By Denise Wee and Olivia Rockeman
March 4, 2020 — 11.04am
From Virgin Australia to US-based cinema chains and casino operators, the companies most vulnerable to the coronavirus outbreak are facing mounting pressure in global credit markets.
An escalating outbreak that drives off customers and revenue could lead to ratings downgrades, hinder refinancing efforts, and in some cases trigger defaults. And it's more than just travel companies: Debt-laden commodities producers, shipping firms and luxury automakers have endured waves of selling by bondholders as they ratchet down expectations for global growth.
Investors who've spent years pouring money into nearly everything the credit markets had to offer are balking now that the outbreak has spread to more than 65 countries. That's stoking fears of a prolonged slump in riskier assets. While central banks from the US to the UK and Japan have all said they stand ready to roll out stimulus to support credit markets, it's not clear the tactic will work if the problem is an historic slump in consumer demand.
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How the coronavirus could lead to a recession
By Ben Casselman
Updated March 4, 2020 — 9.13amfirst published at 8.08am
Epidemiologists are nervously tracking signs that the coronavirus is spreading widely beyond its origins in China. Economists are watching for much the same thing when it comes to the economic damage.
The global outbreak has caused upheaval in stock markets and disrupted supply chains around the world. On Tuesday, the Federal Reserve took aggressive steps to try to contain the damage, announcing that it would slash interest rates by half a percentage point.
So far, there have been few signs of widespread economic damage, at least in the United States. Most employers aren't laying off workers. Consumers are still spending. Shops and restaurants remain open. The Fed's move is an effort to keep it that way.
Economists say a pandemic could clearly cause a recession in the United States and spread throughout the world. But for that to happen, the effects would have to spread beyond manufacturing, travel and other sectors directly affected by the disease. The real sign of trouble, said Tara Sinclair, an economist at George Washington University, will be when companies with no direct connection to the virus start reporting a slump in business.
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The age of pandemic upon us
The death rate of COVID 19 is just 2 per cent. The Spanish flu, which killed 50 million, had the same low mortality rate.
By Tom Whipple
· From The Times
March 2, 2020
The stories tend to begin the same way: with a lone scientist and a warning. There in the laboratory, they look down the microscope. They look up, perhaps rub their eyes, then look down again. Then, having confirmed their worst fears, they rush to the phone to tell their superiors they have found a disease unlike any other.
Of course no one listens to this Nostradamus in a lab coat, but in the weeks and months to come they will wish they had. From Stephen King’s The Stand to Jack London’s The Scarlet Plague, the plot progression of a virus outbreak in fiction is the same. First, hospitals are overwhelmed, then the government tries to cover it up, then society finally breaks down.
Back in the real world, a world that is panicking but not exactly yet at post-apocalyptic fiction levels of panic, real scientists have also been issuing warnings for a long time. In 2018 at Davos, Sylvie Briand, an infectious disease specialist at the World Health Organisation, said the next great pandemic was coming, that we were more vulnerable than ever, “and we have no way to stop it”.
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The new fear index is in the toilet
Stop making bad jokes about the panic purchase of toilet paper. It's become the new index of community concern.
Mar 4, 2020 — 4.29pm
The Toilet Paper index seems to have replaced the Volatility Index as the starkest indication of the level of fear unleashed by the coronavirus.
Certainly this new TIX seems just as reliable a barometer of the public mood as the more commonly cited VIX on the stockmarket.
It’s not just the empty shelves evident in Australian supermarkets despite Woolworths now imposing a limit on customer purchases of toilet rolls and corporate commitments to plentiful supply coming.
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Responding to Covid-19 — A Once-in-a-Century Pandemic?
- Bill Gates
In any crisis, leaders have two equally important responsibilities: solve the immediate problem and keep it from happening again. The Covid-19 pandemic is a case in point. We need to save lives now while also improving the way we respond to outbreaks in general. The first point is more pressing, but the second has crucial long-term consequences.
The long-term challenge — improving our ability to respond to outbreaks — isn’t new. Global health experts have been saying for years that another pandemic whose speed and severity rivaled those of the 1918 influenza epidemic was a matter not of if but of when.1 The Bill and Melinda Gates Foundation has committed substantial resources in recent years to helping the world prepare for such a scenario.
Now we also face an immediate crisis. In the past week, Covid-19 has started behaving a lot like the once-in-a-century pathogen we’ve been worried about. I hope it’s not that bad, but we should assume it will be until we know otherwise.
There are two reasons that Covid-19 is such a threat. First, it can kill healthy adults in addition to elderly people with existing health problems. The data so far suggest that the virus has a case fatality risk around 1%; this rate would make it many times more severe than typical seasonal influenza, putting it somewhere between the 1957 influenza pandemic (0.6%) and the 1918 influenza pandemic (2%).2
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Virus will hit the June quarter too, Treasury warns
Mar 5, 2020 — 9.31am
Treasury Secretary Steven Kennedy has told a parliamentary committee that the economic impact of coronavirus will be deeper and wider than that of SARS and will hit the economy by "at least" 0.5 percentage points in the March quarter as well as flow into the June quarter.
"Given the high degree of uncertainty surrounding the economic impacts of COVID-19 Treasury is assessing the situation on an ongoing basis."
"At this stage we expect the virus to detract at least a half of a percentage point from growth in the March quarter 2020."
"This preliminary estimate takes into account the direct impacts of tourism international education exports and some exchange rate effects. It does not include supply chain disruptions or other potential broader impacts."
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Coronavirus is what you get when you ignore science
What we've seen so far in the global response to the virus should frighten you.
Farhad Manjoo
Mar 4, 2020 — 11.50pm
Let us pray, now, for science. Pray for empiricism and for epidemiology and for vaccines. Pray for peer review and controlled double-blinds. For flu shots, herd immunity and washing your hands. Pray for reason, rigour and expertise. Pray for the precautionary principle. Pray for the NIH and the CDC. Pray for the WHO.
And pray not just for science, but for scientists, too, as well as their colleagues in the application of science — the tireless health care workers, the whistleblowing first responders, the rumpled, righteous public servants whose long-ignored warnings we will learn about only when the 12-part coronavirus docu-disaster series drops on Netflix.
Wish them all well in the fights ahead. Their weapons, the weapons of science, are all we have left — perhaps the only true weapons our kind has ever marshalled against encroaching oblivion.
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How to understand the risks of 100,000 viral deaths
That an MCG-full of Australians might die generated sensational headlines, but rigorous modelling of the best to worst scenarios for the spread of coronavirus will help policymakers prepare a global response to pandemics.
Mar 5, 2020 — 12.00am
The global outbreak of coronavirus is the latest in a series of zoonotic diseases including SARS, bird flu, swine flu, ebola, and HIV/Aids that have moved from animals into human populations.
Nor are major outbreaks of infectious diseases new. Think of the Spanish influenza in 1918-19, Asian influenza in 1957-58, and the Hong Kong influenza pandemic of 1968-69.
Pandemics are as unpredictable as earthquakes. Since 1970, many countries have invested resources into development of national influenza preparedness plans and into building global influenza surveillance and monitoring systems. The early-warning systems include a network of laboratories capable of identifying the reference strain of the epidemic.
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Farmers face crippling crop blow from coronavirus
Mar 4, 2020 — 4.16pm
Farmers are facing supply shortages that could eat into food production after coronavirus shutdowns in Chinese manufacturing.
Stocks of essential farm inputs, including controversial weed killer glyphosate, which remains the most commonly used farm chemical in Australia, are running low after a spike in demand after recent drought-breaking rain.
The glyphosate shortage comes as Bayer prepares to defend two big class actions in Australia launched by farmers and others who allege its Roundup product caused their cancer.
Unfortunate coincidence
Farm chemicals distributor Nufarm said the coronavirus outbreak and extended manufacturing closures in China had coincided with rain across eastern and western Australia.
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'The shock is very significant': Josh Frydenberg promises coronavirus stimulus package
By Eryk Bagshaw and Shane Wright
March 5, 2020 — 9.02am
The Morrison government will deliver a multibillion-dollar stimulus package as coronavirus paralyses critical parts of the economy.
After a phone call overnight with the International Monetary Fund and warnings that Australia could be heading for a contraction, Treasurer Josh Frydenberg said the stimulus would be focused on cash flow, investment and jobs.
"It is going to have a 'b' in front of it that is for sure," said Mr Frydenberg. "The shock is very significant."
The service exports of tourism and education have been hammered by the flow on effects of the virus. The sectors account for up to five per cent of economic growth and are expected to fall by 10 per cent.
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A dry run for the catastrophic pandemic to come
Our naive optimism has left society exposed to potential breakdown when a pestilence runs riot.
Mar 5, 2020 — 3.08pm
For a brief period a few years ago, a bizarre, ahistorical, Whiggish optimism descended on much of the Western world. We thought that we had cracked humanity’s challenges; that we had ascended to a superior, final phase in the great story of human civilisations.
It was, surely, the end of history: Homo sapiens had evolved into Homo rationabilis at some point in the 1990s, the time of Bill Clinton, Cool Britannia and the Cold War dividend. We had mastered progress – scientific, economic, cultural and political. We would live ever-longer, healthier lives, holding hands in a world of almost zero wars, managed free trade, international co-operation and enlightened technocracy, guided by a new meritocratic elite of technologists, economists, lawyers and financiers. The global village would become richer, healthier, more tolerant and more peaceful than anything anybody could ever possibly have dreamt of.
Since then, bit by bit, the deluded certainties of a generation used to radical globalisation and technological triumphalism have been shattered by reality, just as pre-First World War naivety was destroyed in the killing fields of the Somme. The coronavirus is merely the latest blow, the ultimate proof that the Four Horsemen have not been conquered and never will be.
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This virus is more than an economic threat
The dunny paper panic is dumb because toilet paper is still made here. The real concern is Australia's China-reliance in key sectors such as medicines.
Mar 5, 2020 — 8.00pm
Exactly a year ago, Scott Morrison was warning of a recession should Labor win the May election.
"I was one of those who entered the economy under Labor in the 1990s that went into recession," he told The Australian Financial Review Business Summit in 2019.
"We can't go back to that, we must go forward and we have the plans to take Australia there."
Now he's staring at one of his own.
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How an urgent meeting triggered the virus fightback
Before the health crisis, the government had largely declined to act on Lowe's pleas for greater fiscal support. But they are now on the same stimulus page.
Mar 7, 2020 — 12.00am
The government's economic troika of Scott Morrison, Josh Frydenberg and Mathias Cormann gathered in the cabinet's national security bunker at Parliament House on Monday for an emergency video conference call with the Reserve Bank.
They were in coronavirus crisis mode. Public panic was setting in amid stockpiling of household essentials such as toilet paper, importers were struggling to source stock from China, and universities and the tourism industry were scrambling to come up with a plan.
The prospect of the economy contracting in the March quarter was becoming a near certainty. And the first technical recession in almost 30 years – defined as two consecutive quarters of negative growth – was becoming a plausible scenario as the infection spread across the globe.
About 300km away at the RBA headquarters in Sydney's Martin Place, governor Philip Lowe and deputy Guy Debelle signalled to the government that the bank would take what limited actions it could. The government, for its part, informed the RBA about the multibillion-dollar tax relief and budget spending options Treasury had provided.
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Markets extend losses, US bond yields collapse
Mar 7, 2020 — 6.56am
Shares across Europe and in New York extended losses, and US government bond yields plunged anew as the confirmed number of global coronavirus cases topped 100,000 and as the outbreak accelerated within the US.
Benchmark oil suffered its biggest one-day loss in more than 11 years after Russia balked at OPEC's proposed steep production cuts to stabilise prices. Gold edged higher; its advance was checked by profit taking.
Market highlights
ASX futures down 93 points or 1.5% to 6113 near 8.15am AEDT
- AUD +0.3% to 66.35 US cents
- On Wall St near 4pm: Dow -1% S&P 500 -1.7% Nasdaq -1.9%
- In New York, BHP -3.1% Rio -1.7% Atlassian -5.2%
- In Europe: Stoxx 50 -3.9% FTSE -3.6% CAC -3.4% DAX -4.1%
- Spot gold +0.1% to $US1673.82 an ounce at 4.27pm New York time
- Brent crude -9% to $US45.47 a barrel
- Iron ore -2.6% to $US90.19 a tonne
- 10-year yield: US 0.76% Australia 0.67% Germany -0.71%
"Where we go from here will undoubtedly depend on the
spread of the virus," TD Securities economist Admir Kolaj said. "The recent developments build the case that the US will not escape unscathed."
spread of the virus," TD Securities economist Admir Kolaj said. "The recent developments build the case that the US will not escape unscathed."
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Why a cash-splash can't save us from the virus crisis
By Andrew Charlton
March 7, 2020 — 12.00am
Shuttered factories, frightened consumers and crashing stockmarkets are already generating a "top of the rollercoaster" feeling for economists who can see the looming potential for an almighty economic fall.
It is too soon to predict the long-run effect of the COVID-19 epidemic, but it’s not too soon to recognise that the risks are significant and worrying. Travel restrictions on the education and tourism sectors alone are forecast to slash gross domestic product this quarter, with the fallout certain to increase as the outbreak spreads. As the government scrambles to safeguard public health, it must also activate a plan to protect our economy.
Unfortunately, governments are about to discover that the standard economic medicine will not work this time. The typical government response to an economic slowdown is a quick cash splash and a few rate cuts. Australian policymakers have wielded these fiscal and monetary tools to bat away every economic googly from the 1997 Asian financial crisis to the 2001 tech wreck and the 2008 sub-prime crisis.
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From a V to a U to an L - the new alphabet of economic alarm
By Shane Wright
March 7, 2020 — 12.01am
V starts the word virus.
It was also, in economic jargon, the expected shape of the financial recovery from the spread of the coronavirus now crippling economies around the world.
Prime Minister Scott Morrison this week noted that just a fortnight ago, analysts from around the world believed the global impact of the virus would be shaped like the letter V: an extremely short, sharp decline followed by the same shaped recovery.
But Morrison has since said the evolving view is that COVID-19 will punch a U-shaped hole in the economy; rather than the short and sharp bounce back, the economy will run along at the bottom for a little while.
V follows U in the alphabet but in economic terms there is a world of difference - to businesses, to the unemployed, to the state of the budget and to how a government that has spent a decade bashing Labor over its management of the global financial crisis faces its own test.
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Warning of nationwide coronavirus clusters
A doctor who helped spearhead Australia’s fight against HIV/AIDS has warned clusters of coronavirus cases will soon spring up across the country and hundreds of people are likely already infected.
John Dwyer, an emeritus professor of medicine at the University of NSW, said the nation must move from a strategy of containment to a focus on protecting the most vulnerable, including the elderly and those with chronic diseases.
“We are definitely going to have a pandemic in Australia,” Professor Dwyer said. “This is going to get a lot worse before it gets better.”
The number of people in Australia with the coronavirus rose to 63 on Friday, with three new cases in NSW. Worldwide, it has infected more than 100,000.
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Exclusive: The Strongest Evidence Yet That America Is Botching Coronavirus Testing
“I don’t know what went wrong,” a former CDC chief told The Atlantic.
Robinson MeyerAlexis C. Madrigal
11:40 AM ET
Updated at 4:07 p.m. E.T. on Friday, March 6, 2020.
It’s one of the most urgent questions in the United States right now: How many people have actually been tested for the coronavirus?
This number would give a sense of how widespread the disease is, and how forceful a response to it the United States is mustering. But for days, the Centers for Disease Control and Prevention has refused to publish such a count, despite public anxiety and criticism from Congress. On Monday, Stephen Hahn, the commissioner of the Food and Drug Administration, estimated that “by the end of this week, close to a million tests will be able to be performed” in the United States. On Wednesday, Vice President Mike Pence promised that “roughly 1.5 million tests” would be available this week.
But the number of tests performed across the country has fallen far short of those projections, despite extraordinarily high demand, The Atlantic has found.
“The CDC got this right with H1N1 and Zika, and produced huge quantities of test kits that went around the country,” Thomas Frieden, the director of the CDC from 2009 to 2017, told us. “I don’t know what went wrong this time.”
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Inside America's woefully ill-prepared health system
The US healthcare system, so expensive that people actively avoid hospitals, could become the defining political issue of a presidential election year.
Mar 6, 2020 — 11.55am
Last week my wife needed an urgent steroid injection that saw us rush her to Baltimore’s famed Johns Hopkins Hospital.
After filling out paperwork and declaring that we would be paying the costs upfront rather than using a US-based health insurer, a nurse sheepishly detailed the charges.
As the procedure was taking place in a “regulated facility” it would cost around $US3000 ($4545) to use the space for about 30 minutes. But that was based on “last week’s” price and may have shifted since.
On top of that was an upfront ear, nose and throat specialists' fee of another $US250, which could be followed, we were warned, with additional charges.
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Morrison government plans for hundreds of thousands of coronavirus infections
By Dana McCauley
March 6, 2020 — 5.51pm
Hundreds of thousands of Australians could be infected with the novel coronavirus known as COVID-19 under the scenario the federal government is planning for, with Prime Minister Scott Morrison offering to share the estimated $1 billion health cost with the states.
The funding, which would go to public hospitals as well as aged care, child care centres and additional protective masks, is equivalent to about 200,000 acute hospitalisations.
"I hope it is not that much," Mr Morrison told reporters in Canberra on Friday.
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Italy locks down wealthiest and most populous region amid coronavirus spread
By Giulia Segreti and Gavin Jones
March 8, 2020 — 8.33am
Rome: Italy is set to lock down its wealthiest and most populous region, which includes the financial capital Milan, as part of tough new measures expected to be approved on Saturday to try to contain the coronavirus outbreak.
The new rules include telling people not to enter or leave Lombardy, which is home to some 10 million people, as well as 11 provinces in four of Italy's 19 other regions, according to a draft decree seen by Reuters.
All museums, gyms, cultural centres, ski resorts and swimming pools will be shut in the targeted areas, according to the decree, which is due to come into force from Sunday.
The legislation is expected to be approved later on Saturday, the head of the civil protection agency said earlier, after the number of coronavirus infections jumped by more than 1200 in the past 24 hours.
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Coronavirus: Government considers stockpiling drugs as infections climb
March 8, 2020
The federal government is considering stockpiling drugs such as antibiotics and antivirals as the coronavirus continues to spread across the country.
It comes as a Melbourne doctor singled out by Victorian health authorities for treating patients while infected with coronavirus accused the Health Minister of grandstanding over his diagnosis
Australia now has 73 confirmed cases of COVID-19, with two deaths, while 22 people have recovered.
It includes a new case in both Victoria and Tasmania, and eight new cases in NSW confirmed on Saturday.
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The coming recession is written on toilet paper
Wednesday’s December quarter national accounts were a curiosity, irrelevant to the current state of play, except for one thing: they made it clear a recession is almost inevitable.
Any doubt about that, I would suggest, has been removed by the Great Toilet Paper Panic.
It would be funny if it wasn’t serious: for some reason the coronavirus has sparked a worldwide run on bog rolls, to the point where supermarket shelves are devoid of them.
Trolleys have been arriving at check-outs piled high; in Japanese toilets, they are being secured to the dispensers with bicycle locks; in the Sydney CBD the other day, a thief was caught exiting a 20-storey building with two garbage bags full of toilet rolls he had pilfered from each floor.
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Squandered time: How the Trump administration lost control of the coronavirus crisis
March 8, 2020 at 6:19 a.m. GMT+11
The coronavirus had already begun to spiral out of control when Health and Human Services Secretary Alex Azar, during routine Senate testimony, made a surprising claim.
“As of today, I can announce that the CDC has begun working with health departments in five cities to use its flu surveillance network to begin testing individuals with flu-like symptoms for the Chinese coronavirus,” Azar said. “This effort will help see whether there is broader spread than we have been able to detect so far.”
But there were two major problems: The cities weren’t ready, and the tests didn’t work.
In fact, when Azar’s team had sent his prepared remarks to the Centers for Disease Control and Prevention before delivery, the agency pushed back and urged him to soften his language. State health departments had not yet been informed of the plans — and were certain to be upset by them — and the coronavirus test kits contained a faulty component that caused a spike in inconclusive results. Azar announced the plans anyway, in part because “it would be really valuable for him [to] have the news,” as one HHS official put it in an internal email.
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Insurers take cover in ‘exclusion’ on infectious diseases
Insurers are dodging a wave of business and travel insurance claims — potentially pushing into the billions of dollars — from the coronavirus outbreak after exclusions on infectious diseases began creeping into most policies 15 years ago.
As businesses battle stock shortages, fuelled by panic buying and a manufacturing shutdown in Australia’s biggest trading partner China, The Weekend Australian can reveal most will not receive a cent from their insurer.
Meanwhile, Australia Prudential Regulatory Authority chairman Wayne Byres has warned that coronavirus, officially known as COVID-19, and recent natural disasters, including bushfires, hail storms and floods, would generate insurance losses of about $5bn. Australian insurance companies have already been hit with more than $5bn worth of claims, as a result of six declared “catastrophes” since September.
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Royal Commissions And The Like.
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No entries this week.
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National Budget Issues.
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Rate cut chances skyrocket as virus alarm rises
Mar 1, 2020 — 11.46am
The chances of a Reserve Bank of Australia rate cut on Tuesday have surged dramatically as traders price in a rapid central bank response to the worsening coronavirus health emergency.
Pricing for a rate cut when the Australian central bank meets this week is now at 87.5 per cent, up from 18 per cent on Friday. A rate cut is fully priced in for April, compared to a 68 per cent chance of a cut late last week.
There is now a one-in-four chance that interest rates head to zero in Australia by the end of the year, interest rate futures markets are indicating.
Rates markets are more definite about a US rate cut in March, with markets more than fully priced for one 25 basis point cut from the Federal Reserve.
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RBA cuts rates to record 0.5pc
Mar 3, 2020 — 2.30pm
The Reserve Bank of Australia has cut the official cash rate by 0.25 percentage points to a record low of 0.5 per cent.
The cut - the fourth in less than 12 months - follows turmoil in financial markets over the past week driven by fears about the impact of the global coronavirus outbreak.
"The board took this decision to support the economy as it responds to the global coronavirus outbreak."
"The coronavirus outbreak overseas is having a significant effect on the Australian economy at present, particularly in the education and travel sectors."
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GDP grows by 0.5% in December quarter
· Australian Associated Press
The economy expanded by a better than expected 0.5 per cent in the December quarter, with annual growth accelerating to 2.2 per cent from 2.0 per cent in September.
The quarterly increase narrowly beat market consensus of 0.4 per cent growth, however Australian Bureau of Statistics chief e conomistBruce Hockman said the rate of growth remains below the long run average.
Domestic demand remained subdued with 0.1 per cent growth in the December quarter.
A pick up in household discretionary spending and continued increases in the provision of government services was dampened by falls in dwelling and private business investment.
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Economy gets unexpected lift as fourth-quarter GDP rises 0.5pc
The economy picked up momentum through the final three months of 2019, as GDP lifted 0.5 per cent over the quarter, bringing growth to 2.2 per cent over the year.
The relatively robust figures published by the Australian Bureau of Statistics on Wednesday - economists had expected quarterly growth of closer to 0.3 per cent - suggest the economy improved in the later stage of last year, before the twin shocks of bushfires and the coronavirus emergency.
Bruce Hockman, chief economist for the ABS, said “the economy has continued to grow and picked up through the year, however the rate of growth remains below the long run average”.
The Australian dollar climbed on the news, jumping to as much as US66.07c.
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The gentle turning point is about to become an S-bend
The government, which just a week ago said it had "very limited'' capacity to respond to the economy, is now poised to spend several billion dollars as recession fears grow.
Mar 4, 2020 — 6.26pm
Belatedly yesterday, the Australian Bureau of Statistics suggested the gentle turning point in the economy that had been predicted by the Reserve Bank of Australia may have occurred.
A 0.5 per cent growth figure for the December quarter was slightly higher than the economists predicted, even if, technically, it represented a slowdown after the ABS also upgraded its 0.4 per cent growth number for the previous September quarter to a respectable 0.6 per cent.
Whatever the case, that was then and now is now, and to labour the toilet paper pun, the gentle turning point is about to become an S-bend.
As Scott Morrison said earlier this week, as his plans for economic stimulus began to rapidly escalate in response to the crisis, "what you don't do is solve last week's problem, you solve today's problem''.
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PwC predicts budget deficit of up to $25b as government tailors stimulus plan
By Shane Wright and Jennifer Duke
March 5, 2020 — 12.00am
The federal budget faces a $26 billion hit and the economy could suffer an even bigger blow from the coronavirus outbreak with the Morrison government preparing a stimulus package that will look after businesses and self-funded retirees.
Ahead of the release by the International Monetary Fund of its own analysis of how the virus will hit the global economy, work by PricewaterhouseCoopers suggests the government's promised budget surplus is already gone with the economy at dire risk of succumbing to a recession.
With the coronavirus impacting the economy, the government is working on a stimulus package that could include an investment allowance for businesses and changes to deeming rates.
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Risk of first recession in 29 years rising
Mar 5, 2020 — 6.12pm
A $14 billion hit to the economy in the first three months of the year from the coronavirus and bushfires could snowball into Australia's first recession in 29 years, but one with a sharp recovery, economists say.
All four of the big bank economists forecast the economy to contract in the March quarter. They are also recalibrating their views on the June quarter and the federal budget position following the Reserve Bank's and Treasury's estimate of a 0.7 percentage point hit to the economy in the March quarter.
Treasury secretary Steven Kennedy said on Thursday that there was no doubt the June quarter "would also be affected" and that the initial estimate did not include supply chain shocks.
"There are a range of possible scenarios beyond the March quarter," he said.
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Worst Christmas-New Year for retailers on record
By Shane Wright
March 6, 2020 — 12.48pm
Australian retailers have endured their worst Christmas-New Year sales period on record after shoppers snapped shut their wallets as fires and smoke hit the nation.
Before the worst of the outbreak of the coronavirus, figures from the Australian Bureau of Statistics showed the retail sector in a poor position.
Sales fell by 0.3 per cent in January after a downwardly revised 0.7 per cent drop in December.
The worst hit area was the ACT which suffered almost a fortnight of hazardous air quality because of nearby fires before the territory's southern suburbs were directly threatened. Retail sales there fell by 2.3 per cent.
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Health Issues.
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Medicine shortage reports soar, according to TGA
Mandatory reporting has led to a threefold increase in new notifications
2nd March 2020
Medication shortage notifications have jumped threefold since mandatory reporting was introduced last year, a TGA report shows.
The regulator received an average of 150 new notifications a month in 2019, up from 50 a month during 2018, according to a report on the first 12 months of the mandatory reporting scheme, which began in January 2019.
Close to one in 10 shortages were classified as critical — eg, when there are no suitable substitutes or there is a possibility of life-threatening or serious health impacts.
According to the report, the Medicines Shortages Working Party has agreed on further actions to improve the mandatory reporting scheme.
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Hormone therapy now seen as safe – and helpful
Alarmist studies have put many women off safe treatments that can make a real difference to their lives.
Research into the long-term effects of HRT has shown benefits, especially for women who start during perimenopause.
Christie Aschwanden
Mar 7, 2020 — 12.18am
Look at the internet ads and news headlines about menopausal hormone therapy and you'll find two competing story lines: taking hormones is either going to keep a woman young and solve all her menopause-related woes, or it's going to give her breast cancer and other scary diseases.
The truth is that neither narrative is universally correct. Although consensus now exists that women shouldn't take hormone therapy long term, hormones can still safely help many women in the throes of menopause.
Fifty years ago, hormones were advertised as a cure-all. In his 1966 bestseller, Feminine Forever, physician Robert Wilson declared that menopause was a disease, and he had the cure: hormones, without which women would be "condemned to witness the death of their own womanhood".
Hormones are a highly effective way of treating symptoms such as hot flushes, night sweats, mood swings and all the problems like sleep disruption that come with them.
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International Issues.
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Trump's post-truth presidency collides with a global health emergency
By Matthew Knott
March 1, 2020 — 4.18pm
Washington: At a press conference at the White House on Saturday (Sunday AEDT), US President Donald Trump paid tribute to the first American to die after contracting the coronavirus.
"Unfortunately one person passed away overnight," Trump announced. "She was a wonderful woman, a medically high-risk patient in her late 50s."
Vice-President Mike Pence, who is leading the Trump administration's response to the virus, also expressed his condolences, saying the woman's family members were in his prayers.
But the first US coronavirus victim wasn't a woman. It was a man from Washington state, as authorities there later confirmed.
If this had been a one-off, it would have been an unfortunate but forgivable mistake. Instead, it was just the latest in a string of false or misleading claims the Trump administration has made about the outbreak.
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Adviser to Iran's supreme leader dies from virus
A member of a council that advises Iran's supreme leader died on Monday after falling sick from the new coronavirus, state radio reported, becoming the first top official to succumb to the illness that is affecting members of the Islamic Republic's leadership.
Expediency Council member Mohammad Mirmohammadi died at a Tehran hospital of the virus, state radio said. He was 71.
The council advises Khamenei, as well as settles disputes between the supreme leader and parliament.
His death comes as other top officials have contracted the virus in Iran, which has the highest death toll in the world after China, the centre of the outbreak.
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Taliban ‘peace’ deal will bring more tragedy
Donald Trump’s peace deal with the Taliban in Afghanistan is of course not worth the name it has. For one thing is sure, it won’t bring peace. It will bring tragedy.
But I have no criticism of Trump in his desire to bring American troops out of Afghanistan. I have long argued that the West is achieving no long-term strategic objective there. It is an impossible situation, not remotely of Trump’s making. And his attempt to get Americans out is what he promised as a candidate and what his countrymen want. But there will be a cost.
That Trump’s decision attracted so little attention in Australia is an indication that we were never entirely serious about this terrible conflict.
In 2001, not long after the 9/11 terrorist attacks in the US that killed 3000 people and were planned and co-ordinated by al-Qa’ida, then based in Afghanistan, president George W. Bush ordered an invasion. Bush took the legitimate decision to destroy the most pro-terrorist government and state in the world. The Taliban ruled Afghanistan and harboured al-Qa’ida, all in the cause of a global Islamist jihad.
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Russia, Turkey reach Syria ceasefire but fighting continues
By Suzan Fraser
Updated March 6, 2020 — 12.57pmfirst published at 11.25am
Moscow: The Presidents of Russia and Turkey said they have reached agreement on an immediate ceasefire in north-western Syria, where escalating fighting has threatened to put forces from the two countries into direct conflict.
It came into effect at midnight but a few hours later on Friday, Turkey's state-owned Anadolu news agency reported that Turkey had killed 21 members of the Syrian armed forces and destroyed two artillery pieces and two missile launchers in retaliation for the killing of two Turkish soldiers a day earlier.
On Thursday, two soldiers were killed and three others were wounded after Syrian government forces opened fire in the north-western Syrian town of Idlib, the Turkish Defence Ministry said. The incident raised the number slain in Syria since the start of February to 60.
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I look forward to comments on all this!
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David.
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