ADAPT OR DIE
By Karl Arnold Belser
17 April 2020

EPIDEMIC IN THE UNITED STATES

The Coronavirus has severely affected the United States. The widely accepted shelter in place directive has been implemented in many states. the result has been a reduction of deaths for the moment. In California where I live the hospitals were not overwhelmed and there has been enough equipment for the health care workers. But states like New York has suffered mightily. It appears like the United States is about at its peak of infections under the sheltered in place  recommendation.''

The Center for Disease Control (CDC) and the World Health Organization (WHO) state frankly that until there is a vaccine that can create a herd immunity, people will have to keep a safe social distance and wear protective face masks. Further there are medicines like remdesivir from Gilead Sciences that seem promising in lowering the risk of death from the virus..

The net is that it is likely that people will modify their working spaces  to accommodate distancing and by using facial masks. This will minimize the rate of infection such that the sickened people can be treated until a vaccine is available. Based on these advances I expect that the United States will go back to work
by the ind of this summer for the businesses that are left. There will probably be a second wave and these measures based on the experience of South Korea will be sufficient to manage a severe outbreak without a second shelter in place recommendation. I suspect the the United States will struggle on like this until there is a vaccine.

SOCIAL DISTANCING

Social distancing is likely to be a residual from the Coronavirus epidemic. Since the disease may actually have been human engineered such outbreaks might occur again and again. I believe that the US will adapt.

Working from home seems likely to be more common in the future when is is shown to be effective during the epidemic. Even if one goes back to work social distancing in the office will have to occur. This means spacing people farther apart and minimizing the need for employees to touch anything for example by voice activation. There are going to be profound economic consequences.

ECONOMIC EFFECTS

Social distancing will affect any activity that allows people to congregate,like for restaurants, bars, theaters and night clubs. Certainly air, tour bus, train and cruise travel will appear risky because social distancing will be difficult. This might mean that travel by private car will be preferred. People will not travel so much and the the share values of leisure and travel companies will probably suffer. I notice today that food distributors like Sysco and beverage makers like Budweiser are suffering. I expect that retail rents might be forced to go lower.

The number of unemployed has now topped twenty two million. Further maybe twenty five percent of all US businesses are on the verge of collapse.. The US government is doing its best to allow some of  these small businesses to survive. However, I think that many are just zombie companies that will not recover. This will probably leave the unemployment rate high.

I expect that there will be a glut of houses and cars on the market when the current owners cannot make their loan payments. The government and the Federal Reserve cannot save everyone even if they want to.

CONCLUSION

The partial shutting of the US economy is an unprecedented action. There is no past history to examine how a recovery might occur. In fact I worry that a fundamental break will happen in which the government looses control of money.

So far people believe that the government will save them. This financial stress will be a decisive factor in the ongoing paradigm shift.     
   
Last updated April 23, 2020
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