This is NOT an economic crisis!

The global reaction to the consequences of COVID-19 is absolutely warranted BUT its low mortality rate has lulled much of the world into ignoring the fight against a highly contagious virus.

20 March 2020 | Marcus Reubenstein (Image: Mauro Mora)  

Equity markets tanking, central banks slashing rates, quantitative easing, currencies collapsing, big businesses slashing jobs, small businesses going to the wall, casual workers pushed out on the street, panic buying, and governments pulling the trigger on massive fiscal stimulus.

This has all the ingredients of an economic meltdown.

The biggest ingredient – which has caused all of this – has been left out. We are in the midst of an unprecedented global pandemic yet why is there such little focus on the virus itself?

Look at the numbers  

The last 24 hours has revealed two telling, and quite frankly alarming, statistics. Coronavirus deaths in Italy have now surpassed the total number of deaths in China, where transmission of this virus started.  

More dead in Italy than in China, a country with a population 23 times greater.

As of today, 3,405 Italians have died from the coronavirus, just 28 days ago there were none.

Tragically, as you read this, that number is hopelessly out of date.

On 22 February Italy had just 9 reported cases of COVID-19 infection and no deaths. Why on earth are people in Australia not shocked by this; and why does this receive such little media and public attention?

The second telling number is that China recorded not one single new transmission in the past 24 hours. Outside of the epicentre in Hubei province, the next highest death toll is 22 in neighbouring Henan province.

Of China’s 34 other provinces, and provincial level cities, 31 have recorded eight deaths or fewer.

There’s been much focus on the draconian measures taken by the Chinese government to isolate its population and quarantine those infected. Measures so heavy-handed by western standards it would defy belief that any nation such as Australia would even contemplate such a response.

So, the response of communist Chinese is off the cards.

What about South Korea? A thriving democracy, an important trading partner of Australia and vital strategic partner of our great ally the United States.

On March 9, Italy and South Korea both had reported identical numbers of infections. 11 days later Italy’s death rate is 38 times higher!

Lowering the RBA cash rate is not the cure.

Asian countries have contained the spread for a number of clear reasons, high on that list is past experience with other pandemics – these governments and people know what to do. Asian culture leads people to accepting that some actions, even though they might be drastic, should be taken for the greater good.

And Asian people are hyper-vigilant about protecting themselves from any viruses – over the past decade I would have passed through more than 40 Chinese airports, I can’t remember one where my temperature wasn’t taken before I boarded a flight.

Are we living in a parallel universe?

This morning on Australia’s Sky News 24-hour news channel, there were five headline items leading into its 9am bulletin – not one was about COVID-19 infection rates in Australia.

Instead the main news items were (1) travel bans; (2) government stimulus; (3) RBA quantitative easing; (4) Qantas being financially crippled by travel bans; and (5) Italy extending its coronavirus lock-down.  

Buried deep in the bulletin was a brief item giving scant mention to the fact that 31 guests at a wedding south of Sydney had all contracted COVID-19, believed to have been sourced from a guest who travelled from the United States. Does that not signal how contagious this virus really is?

The National Affairs editor of Australia’s major broadsheet newspapers, The Age and Sydney Morning Herald, Mark Kenny was a studio guest. When asked about government action, Kenny’s take was: “It’s all about helping the economy survive.”

Surely it is all about helping people survive!

Nobody is Mad as Hell

Without a mention of containment measures, Kenny was then asked for his impressions on the opening game of Australia’s AFL football season which kicked off the previous night inside an empty stadium. He compared the experience to watching the aptly named Mad as Hell television comedy program which aired two days earlier without a studio audience, saying it lacked “atmosphere.”

The show’s hosts, Laura Jays and Peter Stefanovic were almost blasé about the virus. Jays’ expressed her opinion of the importance of Australian football leagues continuing to stage games.

This is not to single out Jays and Stefanovic, in fact they don’t determine the stories they cover, news producers do. Their example illustrates a very crucial point:

Too many in the Australian media look at this as a largely non-lethal virus from which those infected will recover within two weeks.

Not only are they very wrong, they are giving a population which relies upon them grossly misleading information. It’s not deliberate misinformation, they simply haven’t looked at the numbers.

If infection rates go up, the burden on the health system goes up and deaths will rise. At current rates Australia’s COVID-19 infections are doubling every 3 days.

Two of Sky’s most senior and high-profile presenters, former federal politician, Graham Richardson and, arguably Australia’s most influential media figure, Alan Jones are in self-isolation broadcasting from their homes. Despite the fact that he’s left Sydney and is broadcasting from his country estate, Jones has been using his breakfast radio program, the most listened to talk-back in Australia, to downplay the threat of COVID-19.

All the while the other news anchors at Sky are sitting shoulder-to-shoulder on set, lamenting the lack of atmosphere at a game of football. Worse still the network’s Outsiders program produced an appallingly tasteless promotion, treating COVID-19 as a joke, which is still being aired on the channel.

If this is not living in a parallel universe then what is?    

Time for a reality check

A financial market analyst I spoke to last week made a very salient point, “There’s a great deal of misinformation floating around the world; but there’s also a great deal of information.”

Scientists and academics are providing a significant clue to the seriousness of this situation, many are in some form of self-isolation.

The Kirby Institute at UNSW, whose Professor Raina MacIntyre is a leading world authority on biosecurity and pandemics, has effectively shut down and all of its staff are working remotely.

Dr. Norman Swan the health correspondent at, Australia’s national broadcaster, the ABC has been the media’s leading voice of reason. His clinical knowledge as a physician, and analysis as a diligent correspondent, has been outstanding.

Dr. Swan is not an alarmist, but he has warned of dark days ahead and is at constant pains to point out the Australian infection rate graph is pointing straight up.

COVID-19 is not the end of the world, most people understand this and that is a very good thing, however, most people have also taken their eyes of the ball.

Virtually every nation has instituted different policies to contain the virus and limit the economic and social damage.

They can’t all be right, it’s just simple logic that somebody has got it wrong.

Get the virus under control.

Learn from our Asian neighbours South Korea, Hong Kong, Taiwan and Singapore that have already controlled the spread and the mortality from COVID-19. Controlling the outbreak – not fiscal stimulus, slashing interest rates or bailing out airlines – was their number one priority.

We are in for a world of economic pain from which we will mostly all emerge. We will only start to emerge from that economic pain once we stop the spread of this virus.