While the stock market’s recovery might suggest that people think that the worse is behind us, the panel of doctors we hosted on a call today think that it is too early to gauge. According to their opinion while they have not seen high rise in critical cases from COVID19 but the lack of data on testing means that all such analysis is the blind leading the blind. They feel that the next two weeks is critical as the number of tests available will increase. Both of them thought that the response of Sindh government has been superior than other governments. The positive news was that there are only 10 patients at the Expo center in Karachi and according to Dr. Sara Saeed, only 2% of the patients on their platform reported COVID19 symptoms.
• Markets are rallying yet economic numbers are showing a steep recession. The US market is now up 25% from its trough of the crisis. Yet almost all economic numbers are much worse. IMF predicts the deepest recession in history. Countries like France are expecting 10% decline in GDP. Essentially since 2008, the markets are being running on QE and government stimulus. Someone compared it to an addict running on coke. In the
developed countries, essentially the government has declared many companies as too big to fail and provided a floor to the market.
• The number of new cases globally has stabilized and most countries in Europe, including the UK are now working on exit strategies. In the UK they are considering letting 20-30 years old leave the homes – although that still risks around 600 early deaths. They are also considering giving coloured arm bands to people who have recovered. As we wrote earlier, it will be difficult for governments to remain under lockdown for more than 4 weeks. Even during the Spanish Flu, cities like New York remained opened.
• I think the situation will wane in waves. Countries will impose strict lockdowns and cases will come down, then they will open up and it will spike again. These intermittent lockdowns will remain until mass tests or vaccine are available. One of our institutional clients mentioned that they have 5 mins tests at their office and anyone who enters has to first take that test. The overall global investment in healthcare requires a massive hike to meet the demand.
We pray for the good health of you and your families.
