Wuhan Coronavirus: Megathread - Got too big

[Otterly]

They should cancel the Olympics or postpone them.

Just wait for this year’s Hajj... when’s that? August or something?

 

[MarvinTheParanoidAndroid]

Thank you for putting things into perspective for myself and others. What should I make of Iranians reporting that conditions for patients deteriorate extremely rapidly though, or some of the more bleak news we've gotten?

Probably that they live in a desert hellscape and are of extremely poor health anyways. Have you seen the Middle East from Google Maps? Saudi Arabia is a toilet.

 

[Gender of peace]

Wuflu supply chain impacts for Jan 21 via r/supply chain. Report on the projected economic slowdown is attached.

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Supply chain issues continue to extend beyond automotive and tech; now it's starting to affect household product supply chains. According to Forbes (Link) the American giant Procter and Gamble (2019 revenue: 67.68bn USD) says that it too now has significant problems. “We access 387 suppliers in China that ship to us globally more than 9,000 different materials, impacting approximately 17,600 different finished product items,” Jon Moeller, Procter & Gamble’s chief operating officer and chief financial officer, said Thursday at a conference in New York. “Each of these suppliers faces their own challenges in resuming operations.” The article adds that this will affect P&G's profits in the China retail market.



Bloomberg - another automotive runs into problems; Nissan is warning of disruptions in plants as far as the US due to the virus epidemic leading to parts shortages. They procure more than 800 parts from factories in Hubei and are concerned that many of these pats will run out (including such things as brake hoses and air conditioning controllers) if the plants do not come back online by today (the date the government indicated most production could resume). This could lead some Nissan output in Japan to be suspended as early as Jan 23rd with Malaysia following not longer after. Plants in the US, UK, India, Mexico, Russia and Spain may also have to stop production. A survey of their suppliers found only 58% said they'd be able to resume by Feb 10th with many others saying they couldn't because they couldn't get necessary government approval. Of those that have gone back online, only half of them could get the majority of their workforce working. (Link)



Reuters - major automotive parts manufacturer Valeo (19.48bn EUR revenue in 2019) says that most of its Chinese factories are now back online but not at full operational capacity. It expects production to fall by 2% this year and adds that that it is too early to evaluate the impact of the virus on the company's 2020 results and the wider auto industry. (Link)



The International Air Transport Association (IATA) says that Asia-Pacific airlines could lose $27.8 bn to coronavirus according to Philstar (Link). The estimate is based on projections of a 13-percent full-year decline in passenger demand, mostly in China. IATA's CEO says that this will be the first time since the 2008-2009 financial crisis that demand for air travel has declined and that stopping the virus is a top priority. Airlines in China's domestic market alone are estimated to lose around $12.8 billion in revenues, reversing an expected 4.8% growth into a 8.2% contraction.



Food prices - China produces 80-90% of the worlds garlic supply (depending on which article you read) and the price of it is rising sharply. Prices in the US are up 29% from last year whilst wholesale prices are up even more to 60% higher than this time last year. The reason is difficulties in transportation and a shortage of labour as most people are yet to return to work (either because they're unwilling or they're physically unable). (Link).



Amazon is beginning to worry about Prime day in July - the Seattle Times reports (link). Third party merchants account for about 60% of its sales and it has reached out to these merchants to understand how they might be impacted. Over the past few weeks, Amazon has responded to the crisis by making larger and more frequent orders of Chinese-made products that had already been shipped to the United States, according to company emails and consultants who work with major brands. Some of its suppliers have cut back on advertising and promotions on the site so they don’t run out of products too quickly. “Out of an abundance of caution, we are working with suppliers to secure additional inventory to ensure we maintain our selection for customers,” an Amazon spokeswoman said. The company later added, “We are monitoring developments related to the coronavirus and taking appropriate steps as needed.” Amazon’s algorithms have now asked for six to eight weeks of supply on products made in China instead of just two or three weeks.



The Taiwanese commonwealth magazine has a thoroughly interesting read on whether Taiwanese companies can cope with the Coronavirus (link). It focuses on The Formosa Plastics Group (revenue: 67.2bn USD) first which has forecast that the coronavirus scare will hit it far harder than did the SARS crisis in 2003, with first quarter revenues, which were originally expected to take a turn for the better, likely to slump from the previous quarter. If China shuts down for an extended period of time and inventories build up, “under the worst case scenario, the crack spread [the difference in price between a refined product and crude oil] would fall below US$2, and we would cut production, which would mean we were producing below cost,” Formosa Petrochemical Corp. President Tsao Minh explained. Other industries are examined; automotive has significant issues which we all now know, but steel should be OK from a supply perspective because raw material comes from Australia, Brazil or Canada. The article finishes by explaining that the worst may yet be to come for the entertainment and tourism industries.



Getting workers physically back to work - the SCMP (South China Morning Post) reports (link) that provincial governments in China’s east coast manufacturing hubs are chartering buses, planes and trains to get workers back into their factories to get things moving again; passenger traffic on public transport is only 1/5th of what it was this time last year. Couples returning to work at open factories are eligible for a one-off subsidy of 500 yuan (US$71), while a company that hires more staff than in the same period a year earlier can also receive subsidies up to 300,000 yuan (US$42,800) whilst the city of Yiwu is refunding bus and train tickets for workers who return if they arrive before tomorrow.



Economic woes spread to companies who don't have supply chains: the Epoch Times has an article (link) waring that many small to medium sized enterprises don't have large cash reserves and may struggle if the situation continues for a sustained period. Just 34 percent of nearly 1,000 small and medium-sized firms said they could survive for a month on current cashflow, a recent survey by Tsinghua University and Peking University showed. A third said they could last for two months, while 18 percent said they could stick it out for three months. One analyst estimates that total job losses in China could be as high as 4.5 million.



Apple's Foxconn and Pegatron factories might be open, but don't assume they're fully staffed says MPR News (link). "One production line used to have 4,000 people. Now there are about a dozen remaining. My own production line usually has 1,000 workers, with about 60 now remaining," says a female hanjia worker at Foxconn. (Hanjia means winter break, i.e. people who continue working through the spring holiday that most Chinese take off). Smaller manufacturers are having a harder time. A rare earths magnet maker that normally employs about 300 people in the city of Hangzhou, south of Kunshan, received permission to reopen from local authorities last week. The factory was able to begin manufacturing again with a skeleton crew after buying a large disinfectant machine. Rare earth magnets are used in everything from electronics to motors. For any factory to reopen now, "There's paperwork that has to be submitted to the local government, and that includes guaranteeing masks, some other protective gear that employees can wear, a disinfecting schedule," says manager Jen Ambrose, one of the few Americans who works at the magnet company.



A white paper has arrived! Dun and Bradstreet have done a great report on the economic impact of the coronavirus. If you're into economics, this is definitely worth a 15 minute read. Some takeaways: 90% of all active business in China are affected. At least 51,000 companies around the world have one or more direct tier 1 suppliers and at least 5 million have at least one or more tier 2 suppliers. Alternative countries for suppliers: Electrical machinery and parts could come from Brazil, the nuclear industry could tap Chile or Singapore, Furniture, plastics, toys and games could be covered by Mexico and Brazil, Motor vehicle parts as well as optical and surgical products could be covered by Chile, Colombia or India. Growth is certainly going to drop below previous forecasts but how much by depends on how fast the virus is contained.

 

[Judge Holden]

As long as Corona-Chan only targets the otaku and none of the mangaka it would be a net win.

*meanwhile, in every single otaku nest-bunker in the whole of Japan*

 

[sifareh592]

The doctor is in......and he is a bit worried.

And i think this isn't curable with bed rest and a asperine anymore.

 

[Uranus Pink]

*meanwhile, in every single otaku nest-bunker in the whole of Japan*

They damn well better as they fap to enough hentai to know how this is going to go, end and the after party.

 

[Sissy Galvez]

The CDC should be working 24/7 to develop a vaccine. I know testing takes time to develop it and then testing in humans will also take time but there needs to be a vaccine this year.

I’m cancelling all airplane travel this year unless things settle down by summer.

 

[PepsiVanilla]

I’m pretty sure this is beyond control at this point. All countries had to do was ban all flights to and from China and it would have contained the virus. Now we’re seeing reports in Iran and Italy and the numbers are increasing.

They should cancel the Olympics or postpone them.

I don't know if banning all Chinese air travel would have actually been enough, but yeah that boggles me too how they wouldn't take such a basic obvious measure. Has *any* country even done this yet?

 

[MarvinTheParanoidAndroid]

I don't know if banning all Chinese air travel would have actually been enough, but yeah that boggles me too how they wouldn't take such a basic obvious measure. Has *any* country even done this yet?

Russia, North Korea and I think that's it.

 

[Apathy is my superpower]

Kuwait is evacuating citizens and halts all commercial flights from and to Iran:

Kuwait Airways says that it will be sending a number of flights to evacuate 700 passengers from the Iranian city of Mashhad starting on Saturday after Kuwait halted all flights to and from Iran amid fears from a coronavirus outbreak.

The announcement of the evacuation flights comes days after the coronavirus outbreak, also known as corona, spread to several Iranian cities. Iranian authorities say the outbreak began in the city of Qom and resulted in six deaths as of Saturday.

Kuwait Airways added it “will fulfill any mandate it has from the responsible authorities to evacuate more travelers whenever the need arises so as to ensure their safe return to the homeland.”

Iranian authorities confirmed the detection of at least 10 new cases of coronavirus on Saturday and two more deaths.

Kuwait to evacuate 700 citizens from Iran’s Mashhad amid coronavirus fears

Kuwait Airways says that it will be sending a number of flights to evacuate 700 passengers from the

english.alarabiya.net

TEHRAN – The number of people diagnosed with the novel coronavirus, known as COVID-19, in Iran has increased to 28, of whom six have so far lost their lives.

“Up to now, 785 persons suspected of having the virus have been tested at clinics nationwide,” deputy health minister Kiyanoush Jahanpour said, adding that over the past day ten new cases of infection were confirmed.

Out of the ten new cases, eight are in the city of Qom and two have come from Qom and hospitalized in Tehran, he explained, IRNA reported.

COVID-19 cases in Iran rise to 28, death toll hits 6

TEHRAN – The number of people diagnosed with the novel coronavirus, known as COVID-19, in Iran has increased to 28, of whom six have so far lost their lives.

www.tehrantimes.com

 

[Dog-O-Tron 5000v5.0]

I'm not worried about getting the virus personally. I am worried about near term economic effects. I predict we will start to see empty shelves in American stores by summer of both hard and soft goods. I think most companies will try and ride it out before giving up on Chinese production recovery and the inherent costs of both moving production to other Asian countries and South America, as well as the increase of costs in making the goods in countries with higher wages than China. The last ditch solution would be to move production back to the US, because the cost of goods would skyrocket if produced at US wages.

This will only serve to accelerate the Retail Apocalypse. 5000 stores in 2018, 10,000 in 2019. Probably 20,000 in 2020, and several massive chains closing their doors. Spike in unemployment as hundreds of thousands are fired. All levels will be effected, from hourly drones to executives.

Like the pivot to the housing collapse in the 2008 election, this will massively change the narrative in October. Trump may not survive this, as his big achievement has been the economy. Despite the fact that he's not a Globalist, and it's the globalist economy which is the root cause of this, he will be blamed. The candidate who can best promise relief to the unemployed and underemployed with government handouts will probably carry the election. Expect 2009 levels of unemployment aid and increases to time allowed on the dole in 2021. Stocks will tank. The question is: sell out now or hope for a recovery in 5-10 years? 401ks will be massively devalued.

Now here's where my Doomsday Scenario of paranoia kicks. in. Of course, if we get a socialist/globalist/Social Justice President in, expect amnesty for illegals and de facto if not de jure opening of the border, Take the EBT, food, medicine, housing, and education for millions of new immigrants, combined with aid to rising unemployed citizens, the national deficit and debt will skyrocket. Stocks will continue to fall especially as companies fail. The chain effect of retailers closing, trucking and warehousing collapsing, house sales plummeting, etc will exacerbate the situation. If nobody is working, will Netflix and everyone else be able to pump money into Prestige TV? Doubtful. Same for Hollywood and movies, music and video games. Say goodbye to the glut of "too much tv to watch." No doubt the dollar will lose significant value. It will be harder to rekickstart a global mercantile economy with personal jobs and fiances in freefall. A recession could turn to Depression II.

The last Depression took a decade to get out of, and while FDR had some good ideas, it was arguably the massive employment, manufacturing, and spending for WWII that put us over the hump. Without that, it could last longer. We could see a definite decline in American standards of living that could last for the foreseeable future. Things may not go as bad as total government collapse, currency collapse, states closing borders, martial law, and secession, but for those of us alive now, we may never see a lifestyle as prosperous as we had in 2019 for the rest of our lives. A new normal of doing with less, having less entertainment, technology, new clothing, easy access to gourmet food, vacations, etc. Retiring at 65 or even 70 will become a Boomer thing, as we go back to the pre-Social Security standard of my great grandfather working as a night watchman or bartender til he collapsed at 75.

Or maybe the Chinese factories will start back up in a couple weeks. It's just a flu bro.

 

[JosephStalin]

Thank you for putting things into perspective for myself and others. What should I make of Iranians reporting that conditions for patients deteriorate extremely rapidly though, or some of the more bleak news we've gotten?

A good question, without trying to be a smart-ass. Could be a mutation. Could be poor medical services. Could be some or all of the patients have significant risk factors such as age, weak immune system, other diseases.

If these things are happening on a relatively small scale in just a few places, that's one thing. If we see this happening many patients, especially in a number of geographically separated areas, that's another. The medical and scientific people need to stay on top of this because this virus seems to be a moving target re medicines and vaccines. Again, putting things in overall perspective.

But I would add that a number of organizations are working on a vaccine, and there may be some combination of medicines that could also deal with this virus. So, advise coming back here. Believe our global KF corps is about the best place for good info and good analysis going.

Wuflu supply chain impacts for Jan 21 via r/supply chain. Report on the projected economic slowdown is attached.

Post | archive

Folks, you read it here first. No surprise whatsoever. Seriously, if you think you need that new computer/TV/electronic gadget/appliance consider getting it now while the getting is good. My new laptop coming today.

 

[MarvinTheParanoidAndroid]

I'm not worried about getting the virus personally. I am worried about near term economic effects. I predict we will start to see empty shelves in American stores by summer of both hard and soft goods.

There's no way they'd be stupid enough to allow production to get that bad before bailing on China and going literally anywhere else in the world that would let them exploit labor for pennies on the dollar like China does.

 

[Tasty Tatty]

Thank you for putting things into perspective for myself and others. What should I make of Iranians reporting that conditions for patients deteriorate extremely rapidly though, or some of the more bleak news we've gotten?

That God's on Trump's side because he's getting rid of his enemies?

Seriously, Iran has bad living conditions and their gov. is as bad as China handling info.

The virus is out everywhere already, the best we can do is to inform people properly, close the borders, isolate, and make the best of that. It's not longer a question of IF, but WHEN and HOW we'll be able to get through it. Peopel with better health and better resources will do well. Most of us belongs to that category.

 

[Noideawhattopick]

There's no way they'd be stupid enough to allow production to get that bad before bailing on China and going literally anywhere else in the world that would let them exploit labor for pennies on the dollar like China does.

Exactly. China's CCP is ruthless as we know they will continue to produce even when the virus hasn't been defeated yet.
They do not want to loose their production monopoly, whatever it cosrs.

 

[MarvinTheParanoidAndroid]

The last ditch solution would be to move production back to the US, because the cost of goods would skyrocket if produced at US wages.

This will only serve to accelerate the Retail Apocalypse. 5000 stores in 2018, 10,000 in 2019. Probably 20,000 in 2020, and several massive chains closing their doors. Spike in unemployment as hundreds of thousands are fired. All levels will be effected, from hourly drones to executives.

My forecast is that at that time it won't really matter if prices inflate from that happening because the money spent on buying home sourced product is going back to the country it came from rather than into a foreign power. At that point, the apparent price will change but the overall wealth will increase because the resources being used are coming from local stock rather than from overseas.

 

[Otterly]

There's no way they'd be stupid enough to allow production to get that bad before bailing on China and going literally anywhere else in the world that would let them exploit labor for pennies on the dollar like China does.

All those places may get hit very badly too. China has had a head start, but that cluster in Iran is worrying, s korea looks like it’s next, and similar clusters are inevitable elsewhere. They will be wondering which third world country they can exploit next, but none of them are guaranteed not to go down the route China has in terms of spread. I think at this point it’s going everywhere and by definition third world countries have third world governments and healthcare.
Bringing production back to the west, or at least part of it - I mean it sounds fantastic, but I can imagine there will be a lot of resistance to it. Exposing how weak our globalist economy is is no bad thing. We live in interesting times

 

[Arctic Fox]

Talk about smoking gun...

Bloomberg on Twitter

“Chinese President Xi expresses gratitude to Bill and Melinda Gates for support to his country after the coronavirus outbreak https://t.co/btYheMKy5T”

twitter.com

*Conspiracies Intensify and reaches a new level*

Do we still all remember the Bill and Melinda Gates "sponsored" event 201 virus outbreak simulation a few months ago before this shit went out..

Enough with the conspiracy theories. We all know the truth about Gates. His nigger cattle herd and what he's being doing with them. This is a problem.

 

[Dog-O-Tron 5000v5.0]

There's no way they'd be stupid enough to allow production to get that bad before bailing on China and going literally anywhere else in the world that would let them exploit labor for pennies on the dollar like China does.

How long do you think it takes to go to a country, scout out buildings, meet with govt officials, get permits, hire people, move machinery over (or buy new machinery), train workers, and set up exports? Like 2 weeks or something? And you think the cost is just negligible?

Chinese suppliers are telling companies that the factories are reopening any day now. A smart company would ignore that and vacate China now. Most companies will want to believe it, and if they move assume it might be temporary and can get back to China in a year or so. A lot of companies will try to ride it out. Not to mention the fact that you have companies that put together products, but the pieces are from other Chinese companies. You have to move a lot of the ground up stuff out of China. We've set ourselves up as an economy where it's cheaper to grow chickens and slaughter them in the US, fly them to China, process them, and send them back. You aren't going to walk into a village in Bumfuck, Thailand and be able to make that chicken factory (or textile, or sewing, or machining, or gadget building factory) overnight.

It might be possible to move, but there will be a definite lapse in available just in time inventory. Best case scenario you're right. Companies are looking to permanently leave China now. They are setting up factories now, preferably not in Asia where cases are spreading. Still expect an interregnum between the last ships of Chinese goods hitting to the new non-Chinese goods appearing on the shelves. At best you're talking sparse shelves and some product shortages in the summer to fall, with at least a 20% decline in sales for Back To School shopping. You could see a recovery in available inventory by Christmas. However some retailers on the brink will definitely shut their doors--expect say Sears/Kmart, Pennys, and a few small fashion chains to be gone by the year's end. The impact on stores like Dollar Tree and Family Dollar which survive on cheap Chinese shit as well as the mom and pop dollar stores could be huge. Apu at the dirt mall who has a store full of cheap knockoff shit he buys from sketchy Chinese sites for 30 cents and sells for a dollar is gone.

 

[MarvinTheParanoidAndroid]

All those places may get hit very badly too. China has had a head start, but that cluster in Iran is worrying, s korea looks like it’s next, and similar clusters are inevitable elsewhere. They will be wondering which third world country they can exploit next, but none of them are guaranteed not to go down the route China has in terms of spread. I think at this point it’s going everywhere and by definition third world countries have third world governments and healthcare.
Bringing production back to the west, or at least part of it - I mean it sounds fantastic, but I can imagine there will be a lot of resistance to it. Exposing how weak our globalist economy is is no bad thing. We live in interesting times

Local companies are going to emerge almost immediately if supply chains from foreign countries fail. Remember when Hostess went out of business and declared bankruptcy and stopped producing Twinkies? Remember what happened between then and when they sold out and got their shit together? Other companies I never even heard of stepped up to the plate to take their place until they came back to retake their real estate at Walmart and gas station shelves. There are people out there banging on the walls from the outside to get in just for a chance to make a stand over China and the globalist economy as a whole. There's going to be turbulence no doubt, but it'll be temporary.