It is the senseless things of this world that sometimes knock sense into the high and mighty whose hubris causes them to believe they cannot fall. In this case, the tiny COVID-19 virus (coronavirus) is bringing down a global house of cards long perched to fall — locks, stocks, and barrels of oil.
Stock investors thought the over-Fed market’s bull run would prove immortal, but all the overripe market needed was for a fat, black swan to drop down on the market’s head and knock some sense into it. Economic damage worldwide, however, is far from limited to stocks. Some of it seems almost silly or bizarre, but such is the case when the entire global economy is already in ill health, having survived on Fedmed for a decade.
The economic impact of this little virus is already pandemic. While it is fear more than actual health problems that has apparently kicked the entire world in the butt right now, the lack of medical reality big enough to merit the fear does not in any way diminish the reality of fear’s economic impact.
Today, the little COVID-19 virus delivered the third biggest point-drop in Dow history, suddenly turning the long overheated stock market hypothermic by taking out all of 2020’s gains in a single day! Wall Street may be stunned, but no one reading here is. A day like this would put any investor in cold sweats about what the future holds.
Still, I’ve seen virus scares come and go, and I’ve even said in the past that one of those viral scares (ebola) would likely crash the stock market; but it didn’t quite do that. So, I want to point out up front that it is important to keep in mind — even on a day like today — that the market fell during the ebola scare just as it has now, but then it quickly recovered. So, too, now, investors will just as readily go back to their foolhardy hubris if this virus goes away before the month of May as flu viruses usually do on their own.
Look, the track record on viruses and diseases over the past 20 years has been clear: Any market impact is temporary and/or minimal at best. Look at SARS in 2003, $SPX rallied over 20% in 2003. But the backdrop was different. The US just came out of a recession and markets had bottomed in 2002. Markets in 2003 were at the beginning of a new business cycle.
This cycle here is old, and one could argue was merely saved again by a Fed going into full easing mode in 2019.
But given the fact that the Fed failed to normalize in the lead up to 2018 and was stopped dead in its tracks because of a 20% market correction and was forced to go back into full easing mode the concern is that the Fed just wasted precious ammunition.
Wouldn’t you know it would be a senseless little virus like COVID-19 that has knocked all common sense out of the world? (An easy task in an economy that was already senseless.)
The overall economic pandemic from COVID-19
Alibaba Group Holding … warned the novel coronavirus is a “black swan event” that is hurting the company’s performance and might affect the global economy.
Earlier, in its “December Quarter 2019 Results,” the Chinese giant, Alibaba, tried to turn a lemon into honey-lemon cough syrup in order to qualm fears that its own revenue would be hurt by COVID-19:
In response to the coronavirus, we mobilized Alibaba ecosystem’s powerful forces of commerce and technology to fully support the fight against the outbreak, ensure supply of daily necessities for our communities and introduced practical relief measures for our merchants. No matter past, present or future, we remain true to our mission and we will support our merchants to overcome this challenging time together.
A little cough syrup helps the bad news go down as Alibaba’s CFO Maggie Wu also warned that the company is not immune to shock from the “imbalance of supply and demand.” Wu warned that overall revenue growth for massive Alibaba’s first quarter would turn negative because of the economic shock from coronavirus, which she said has already shut down two-thirds of the Chinese economy.
Or as Citi put it,
CITI: “What we find particularly troubling is the potential interaction between the shock from the virus, already stretched market valuations, and central banks approaching the local limits of their ability to prop up markets.”
— Carl Quintanilla (@carlquintanilla) January 31, 2020
There is the key. Market valuations, as I have been pointing out far longer than Citi were stretched far beyond what our tenuous global economy or business statistics merit. That leaves a market that has lot of potential room to fall. On top of that, central banks have already used up most of their pharmacy. They don’t have a lot of medicine left to use that hasn’t already passed its sell-by date.
The bigger economic concern from the corona virus (COVID-19) is not that health issues will slow the economy by keeping millions home sick; it is mass hysteria, which appears to have already made a good start. China, as the prime example, has quarantined almost half a billion people! No wonder the rest of the world is running scared. This must be one of the world’s most deadly diseases to merit quarantining more than the entire US population!
It doesn’t matter if the virus is all that deadly if fear causes a stampede. I’m not going to say this virus will do that because the big ebola outbreak a few years ago failed to turn into that as did the SARS scare, even though ears were trembling everywhere when the news media began covering those outbreaks. After all, viral good news tomorrow could send this deliriously over-medicated market up to 30,000 on the Dow by the end of the week.
Times are different now, though, so fear is already having a much larger economic impact than ebola had, which was limited almost exclusively to a minor stock-market panic attack. This time we are already talking actual factory shutdowns, city lockups, and riots in the streets. Consider the differences between now and 2003 when the SARS outbreak happened:
• The coronavirus is occurring after a 10-year bull market. SARS occurred when the market was beginning to recover from the 2000 crash.
• The coronavirus is occurring when the stock market is very overbought. This was not the case with SARS.
• The Chinese economy was much smaller in 2003.
• Travel has dramatically increased since 2003.
• Over the past few years, China has been the engine of global growth.
• Before the coronavirus, the Chinese economy was growing at the slowest rate in 29 years.
The economic environment in which the COVID-19 disease is happening is much more fragile right now and much more interdependent on trade that originates from heart of this disease outbreak.
My goal with this article is not to cover the actual health risks of the disease or the epidemiology, as I did in my last article, but to survey the economic havoc that the disease is already wrecking, whether it is due to actual health damage or just fear.
A swan’s-eye view of the economic damage already in play due to COVID-19 (the coronavirus)
The World Trade Organization said that a year already off to a slow start will get worse to coronavirus (COVID-19)
“The slow start could be dampened further,” the WTO said in the report, “by global health threats and other recent developments in the first few months of the year…. Indeed, year-on-year trade growth may fall again in the first quarter of 2020, though official statistics to confirm this will only become available in June.”
JPMorgan expects China’s first-quarter GDP growth rate to crash from its targeted 6% growth rate to 1% if the infection rate from COVID-19 remains as it is or to go as negative as the virus can take it if the spread becomes an epidemic.
Goldman Sachs anticipates coronavirus could hack as much as 2% off off global GDP and 0.25% off of US and European GDP.
Chinese factories, already slowing due to global recession and trade wars, are now operating at only 50-60% capacity. 85% of Chinese small businesses, which employ more than three-quarters of Chinese labor force, report they are at risk of running out of cash in just three months.
“This is the most difficult time I have ever experienced” after 11 years of running the company, Zhu said.
Imagine the economic and socio-political impact if 85% of the Chinese labor force is unemployed in three months due to businesses shutting down! To diminish the risk economic collapse, China injected a massive 5-trillion yuan (US$725 billion) in QE into its economy in January when the viral outbreak began, mostly via raised government bond issuance financed by the People’s Bank of China, but numerous businesses are reporting great difficulty accessing those emergency funds.
Unfortunately, as a result of the anticipated huge drop in government revenues due to diminished business, China’s finance minister has already indicated the government may not be able to sustain this kind of support:
While it is generally expected that fiscal stimulus and monetary easing will undoubtedly be the two main tools of central authorities for alleviating downward pressure on the economy and for maintaining macroeconomic stability, given the past experience and the financial risks currently facing China, a flood of spending programs seems no longer on the financial regulators’ list of choices for stimulating the economy.
“China will face decreased fiscal revenues and increased expenditures for some time to come, and the fiscal operation will maintain a state of ‘tight balance.’, Chinese Finance Minister Liu Kun wrote. “In this situation, it won’t be feasible to adopt a proactive fiscal policy by expanding the fiscal expenditure scale … and instead, policies and capital must be used in a more effective, precise and targeted way,” Liu said.
The number of businesses ready to fail in three months or less and the limited ability of the Chinese government to offer fiscal stimulus with so many direct costs from the virus means China has little time to resuscitate its already ailing and now dying economy. Yet, if it fails to contain the virus with its extreme measures, fears will grow worse and so will the economic fallout.
“If China fails to contain the virus in the first quarter, I expect a vast number of small businesses would go under,” said Lv Changshun, an analyst at Beijing Zhonghe Yingtai Management Consultant Co….
Many of China’s businesses were already grasping for lifelines before the virus hit, pummeled by a trade war and lending crackdown that sent economic growth to a three-decade low last year. At most risk are the labor-intensive catering and restaurant industries, travel agencies, airlines, hotels and shopping malls, according to Lianhe Rating.
Yang, a property manager of a seven-story mall in Shanghai, says a tenant who runs a 150-room hotel that’s usually busy has called asking for a month’s rent waiver after business dried up….
Banks are hardly any better off themselves. Many are under-capitalized and on the ropes after two years of record debt defaults.
Just as Chinese business conditions finally showed a nice bump up due to the signing of the Phase One trade deal, they suddenly took their worst plunge in history:
Finally, as a result of ZIRP (zero involvement of real patrons), real-estate sales in China are running at less than 25% of the normal post-new-year level. Cinemas are empty as, of course, are those viral-exchange places known as Chinese buffets (and all other restaurants), and all of that will make it impossible for China to meet its new US Ag. import quotas, putting the Phase-One, Trump-Trade-War, semi-resolution at risk, too.
COVID-19’s global impact on auto sales and production
Car sales in China plunged 92% in February, exacerbating our global auto-immune disease known as Carmageddon. Many manufacturers, even in the US, looked to China for new growth in car sales. You can see that traffic in overall Chinese car sales has been backed up for months already, but it is now so much worse:
It is possible a lot of this was just due to businesses being closed for the Chinese New Year. However, the New Year closures continue:
Brigita, a director at one of China’s largest car dealers, is running out of options. Her firm’s 100 outlets have been closed for about a month because of the coronavirus, cash reserves are dwindling and banks are reluctant to extend deadlines on billions of yuan in debt coming due over the next few months. “If we can’t pay back the bonds, it will be very, very bad,” said Brigita, whose company has 10,000 employees and sells mid- to high-end car brands such as BMWs.
In the UK Land Rover has lowered production because of unavailable parts from China.
Hyundai and Kia suspended auto production lines in South Korea as a result of a parts shortage from China. Hyundai, Tesla, Ford and Nissan have all temporarily shut factories in China.
Fiat-Chrysler announced it will temporarily halt all production at its Serbia plant due to coronavirus paralyzing its supply chains — one little sign of how the economic contagion has already hit Europe. A mere stoppage of four suppliers has shut down production because, you cannot ship a new car without its requisite radio (or a couple of other critical parts).
The South Korean COVID-19 contagion
South Korea’s problems are not limited to a shortage of auto parts. Daegu City with its 2.5 million residents has been shuttered because of a tiny handful of COVID-19 infections breaking out in the city (140 infections) and just one death. Most of the infections are confined to a single cult church that believes its pastor is Jesus Christ and that he will will take an apocalyptic 144,000 to heaven with him. Looks like that train might be departing early. Physician heal thy congregation. The Jezebel who started this Korean plague of 140 people was a sixty-one-year-old woman who refused to be tested for coronavirus, in spite of her symptoms, and who attended four services.
Narrowly confined as the contagion is, Daegu City’s mayor has deemed it an “unprecedented crisis.” He’s shut down concerts, libraries and schools, and told citizens to remain indoors.Troops have been confined to their barracks. Because of this one small outbreak in a church and a mayor with flailing hands, the city now looks a vacant as a post-apocalyptic world. City streets are reportedly devoid of cars and people due to fear spreading like an invisible fog.
At the present rate of economic contagion, all of South Korea could be closed for business in a month … unless common sense starts to return, but zombies aren’t known for brains:
Tell me that is not mass hysteria.
COVID-19 causes high-tech hemorrhaging
Apple has scaled back production of almost anything it makes because essential parts from China are not available. The virus has put production at one of Apple’s suppliers in China largely on hold. Like a cascading infection, one factory making parts can be shut down or slowed because it is waiting for a component from another factory more directly hit by the coronavirus. (In Apple’s case, this is even spreading to factories outside of China, such as in India.) As a result, Apple’s iPhone supply chain from China is only operating at about 30-50% of capacity. And, as a result of all that, Apple slashed forward revenue guidance, causing its stock to fall last week.
While businesses are closing production all over China because workers won’t come to work or because parts cannot be obtained, that is just one side of the problem for Apple. The other side is that a sixth of Apple sales come from China as does nearly half of chip-maker Qualcomm’s revenue. Because no one is going out shopping, Apple has closed stores in China. So, supply and demand are seizing up together.
Morningstar analyst Don Yew said there should be a limited impact on Foxconn’s supply chain [Apple’s supplier] if factories are closed down in Wuhan for an extended period…. The big concern Yew said, is that if the smartphone manufacturing hub in Guangdong is shut down for an extended period, it would then start disrupting Apple iPhone shipments, possibly creating shortages of iPhones.
FoxConn has offered extra bonuses just to entice workers back.
Another Apple supplier, chipmaker SK Hynix (one of the world’s largest semi-conductor manufacturers), told 800 of its workers at one factory to stay at home for several weeks because a single worker was infected with the COVID-19 coronavirus.
The bite out of the Apple is not due entirely to factory labor shortages in China but also to virally induced transportation problems.
China’s overall smartphone shipments (all companies) fell by 50%-60%. Shipments of smartwatches, smart bracelets, computers/notebooks, monitors, televisions, video game consoles, earphones, and smart speakers are expected to do the same. Falling component shipments will delay the production of similar items in the US and other parts of the world (to the limited extent that the US still manufactures such things).
Samsung and Motorola had to stop producing cellphones in Brazil due to the lack of parts purchased in China. Samsung also reported on Saturday that it was closing an entire smartphone plant in South Korea due to a single case of COVID-19 in that factory. The plant is being sanitized, and all employees who came into contact with the sick employee were placed on self-quarantine.
Nomura states that China’s tech sector PMI dropped to 30 (as a reminder a reading below 50 in the Purchase Manager’s Index is considered recessionary). Overall manufacturing PMI is expected to do the about same when China releases official figures.
Sony Corp. announced that the slowdown due to the virus could decimate its revised outlook for 2020.
The coal-black, oil-black swan lands on global resource markets
As a proxy measure of industrial activity, look at the difference in China’s coal consumption this year (red line) before, during and after Chinese New Year opposed to previous years:
As a bonus from the drop in traffic and in coal use (about 40%), notorious Chinese pollution is way down, and Chinese air is nearly transparent again! In fact, the rest of the world should be looking cleaner and brighter, too. Goldman Sachs slashed its bearish forecast for global oil prices by $10 per barrel, mostly due to collapsing Chinese consumption (forecast to fall 20%). Very Large Crude Carrier (VLCC) shipping rates have collapsed as tankers sit idle without orders to carry.
BP said current demand for the year is between 300,000 and 500,000 barrels a day, not the 1.2 million it had anticipated for the year. “There is no question coronavirus, I suspect, will impact demand this year,” a BP executive told investors.
Commodity prices fell considerably within two weeks of the COVID-19 outbreak.
COVID-19 takes the wind out of shipping sales and other transportation
Maersk, the world’s largest container shipping company forecasted that the COVID-19 virus will diminish its earnings this year. Freight has already been flagging badly, as pointed out in a previous last article. Maersk had already experienced a fourth-quarter loss of $72 million as compared to a profit of $46 million a year earlier. Shipping fell suddenly after front loaded shipments that happened earlier in anticipation of the Trump Tariffs.
United Airlines announced it had experienced a 100% drop in demand from China and withdrew all full-year guidance for 2020 “due to the heightened uncertainty surrounding this outbreak.” The airline said it has also seen a 75% drop in the rest of its trans-Pacific flights.
Air France and Qantas also reported diminished traffic.
Passenger traffic inside of China is down 85% (YoY)! Travel restrictions and/or city-wide quarantines are a big part of why factories in China have shut down. Workers who travelled across the country during Chinese New Year have not been able to travel back to their home towns.
Royal Caribbean Cruises has reduced its outlook for earnings by twenty-five cents a share due to itinerary changes and cruise cancelations (eight cruises cancelled so far).
The Grim-Reaper swan lands in Europe
COVID-19 made a splash-landing in Italy over the weekend. Two-hundred infections (and five deaths) — a light sneeze compared to the number of influenza cases and deaths in Italy — have walled off entire towns, particularly in the Lombardy and Veneto regions by national and regional decree. About 50,000 people are contained by the lockdowns.
Police manned checkpoints around quarantined towns in northern Italy on Monday as authorities sought to contain the novel coronavirus that has made the country the focal point of the outbreak in Europe….
At least 10 towns in northern Italy, with a population of around 50,000, were locked down Sunday to help stop the spread of the virus….
The government introduced a number of containment measures Saturday and suspended all public events and gatherings and shut down schools, nurseries, museums and other public offices.
The COVID-19 virus even put a new face on Venice’s famous carnival:
Hundreds of workers who have come into contact with those who tested positive have been put in isolation. Austria suspended train services in and out of the new Lombardy leper colony for four hours. Germany, of course, has vowed to retain open borders.
The Lombardy government said the disease entered the old Roman republic through a Chinese couple from Wuhan and a 38-year-old traveler who had been to China. The traveler is not known to have a taste for bats, the Chinese cuisine rumored to have introduced the disease into the Chinese population.
Authorities who closed the city walls, so to speak, urged calm while creating panic.
— News from Italy (@newsfromitaly) February 23, 2020
If there is one thing Italy knows besides food, it is fashion, and this was fashion week in the northern provinces. (It actually was.) Judging from the photo above, white is the new black.
Iran, you ran, we all ran
Speaking of fashion, this disease has introduced a new style of veil in Iran, worn by both men and women.
As if the Middle East is not violent enough already, COVID-19 has rabidly inflamed the minds of Iranians, causing riots in the streets. Even hospital staff are reportedly “terrorized.” How odd to be terrorized in Iran.
Their government has been lying to them and their media was instructed not to report on the coronavirus outbreak as it rapidly spread from the religious city of Qom to other cities. On Saturday, Tehran was awash with rumors and riots occurred in the city of Talesh on the Caspian sea due to a quarantine.
“The situation inside the hospital is very scary and terrifying,” one man tweeted. “Even the hospital medical staff, some of whom are infected with the coronavirus, are terrified….”
By Saturday evening at least six people were dead but official figures put the number of infections only in the twenties. In fact rumors were spreading that the numbers could be in the hundreds or a thousand cases.
The Iranian government has closed schools, universities, conferences and cultural centers in fourteen provinces, banned soccer matches for a week and is spraying subways with disinfectant. It has dedicated 230 hospitals to fighting the COVID-19 virus. Water fountains and snack shops have also been shut down. (All based on an official death toll of twelve people and sixty known infections.)
The purported riots are due to denial by the Iranian government regarding claims that these official numbers are understated. If news of the riots is true, more people could die of fear gone viral than of the virus itself.
I just received video of Islamic Republic Security firing tear gas to disperse crowds outside hospital to express concern about #Coronavirius in town of Talesh in Iran. People are angry because of mismanagement after days of denial. t.co/EgXQCkARRZ
— Masih Alinejad 🏳️ (@AlinejadMasih) February 22, 2020
It is, of course, hard to say with certainty whether news of riots has anything to do with COVID-19 quarantines, which the government denies, or if all of this is just another Middle-Eastern block party, protesting the contemporaneous tainted Iranian elections.
The news of five coronavirus-related deaths and 18 fresh cases came as Iran prepares for Friday’s parliamentary election. There are fears that it might affect the voter turnout in Tehran and Qom.
“As we can see people are moving around wearing masks, and many people are staying indoors after the news that coronavirus has reached Iran,” said Ishtiyaq Hussain, a university student in Tehran.
“It is highly likely that it will affect the voter turnout in major cities as people are panic-stricken,” Hussain said.
It might be just one more excuse to boycott the ballot boxes. Unsurprisingly, Iran is accused of censoring all news on the subject, so we have to go to Thailand to get the scoop on Iran:
Sporadic riots were reported in Tehran, Qom, Markazi, Gilan, Ardabil, Kermanshah, Qazvin, Zanjan, Mazandaran, Golestan, Hamedan, Alborz, Semnan, and Kurdistan.
The riots started as the government ordered all schools, stores, malls, cultural centers to be closed nationwide with effective on Saturday noon as a preventive measure to contain the coronavirus spread.
Regardless of elections (or maybe because of?), the quarantine may expand.
Mohsen Hashemi, head of Tehran’s municipal council, also told AFP that the entire city — which has about 9 million residents — would be put under quarantine if it sees more infections.
A dozen people dead, and it’s time to start talking of quarantining 9,000,000. As one of my readers reminded me, one should never let a good crisis go to waste. I don’t mean to belittle their deaths individually, but that many people die of influenza in the US every fifteen minutes during flu season.
Nations all around Iran are reportedly restricting travel in and out of Iran — nations that do not normally do so — including Pakistan, Turkey, Azerbaijan, Armenia, Iraq and Kuwait. Maybe COVID-19 should be renamed the Sanction Virus, since it has been more effective at shutting down regional commerce with Iran in one week than President Trump has been in three years.
Ukraine, not wanting to be outdone in riotous indignation, threw a similar, albeit Soviet-style, bloc party in response to COVID-19:
In Ukraine, protesters on Thursday attacked buses carrying 45 Ukrainians and 27 other evacuees from the Chinese city of Wuhan, the virus’ centre, to the small town of Novi Sanzhary, fearing they would be a health hazard. Videos showed dozens of protesters lighting tires ablaze and hurling rocks at the buses carrying the evacuees. Riot police broke up the crowds and detained 24 people.
Future risks from further economic contagion of COVID-19
China is South America‘s largest trading partner (especially for Brazil, Chile, and Peru). It is a major purchaser of minerals (especially Brazilian copper and iron and Columbian and Ecuadorian oil) and agricultural products. The latter were already under grave threat due to the increased requirements of Trump’s Phase One trade deal with China that effectively doubles China’s pre-trade-war Ag. purchases from the US. With large parts of China’s economy in lockdown, an immediate stop has been placed on these exports from South America, using force majeure clauses.
Potential spillover in the region could come from heightened risk aversion on behalf of investors and a worsening of global financial conditions overall. Investors fleeing risk means an increased search for safe assets – usually in developed economies – that can trigger liquidity droughts and strong exchange rate depreciations in Latin America.
The decline in mineral demand is hitting North America, too, where the largest copper mining company Freeport-McMoran’s CEO Richard Adkerson …
called the outbreak of a deadly coronavirus in China a “real black swan event.” The term is a reference to the book “Black Swan,” which looks at the potentially catastrophic effects of unpredictable events.
Mexico’s manufacturing relies on parts from China, and is certain to slow because of unavailable parts.
The world, until today, was at odds with the indifferent US stock market. Now they’ve synched up.
With the benefit of full-year data, only now are we becoming aware of the danger the global economy narrowly avoided in 2019. According to the International Monetary Fund’s latest estimates, world GDP grew by just 2.9% last year – the weakest performance since the outright contraction in the depths of the global financial crisis in 2009….
Last year’s shortfall from trend (0.6 percentage points) brought growth uncomfortably close to the widely accepted global recession threshold of approximately 2.5%…. A 2.9% growth outcome for the world economy underscores the lack of a comfortable cushion in the event of a shock….
With the world economy operating dangerously close to stall speed, the confluence of ever-present shocks and a sharply diminished trade cushion raises serious questions about financial markets’ increasingly optimistic view of global economic prospects.
Maybe today the US financial market started to get up to speed on the economic risks all around it. If so, it’s about time. Indeed, if the global economy sat right on the threshold of global recession last year, where will it be this year if the coronavirus contagion continues through even the first half of the year?
On the other hand, all of this could be over by the end of March as weather warms and the virus, like its far, far more deadly and distant cousin, the common cold, begins to fade.
Is it a swan or a goat?
Naturally, Goldman Sachs and The Federal Reserve are already fastening on the COVID-19 virus as a scapegoat for all of our economic woes, never mind that anyone could see, as just described by the IMF, that recession was building throughout the world, including in the US as I’ve routinely laid out, ever since last summer.
So, here is an economic prediction I am loathe to make, but one I am nearly certain of if viral fears continue their path of economic destruction. The Fed and the Trump will both use this swan as a scapegoat for their own badly failing economic policies, and we’ll end up learning nothing and repeating all of their “recovery” mistakes all over again because, in their fear, people seem ready to believe almost anything about this virus.
Like Sven Henrich (below), I wish it were not here to provide such a ready excuse for their own highly predictable failures that were already well developed:
I hope the coronavirus is not the trigger that gets associated with an eventual end to this bull market. For one, it’s the worst reason as people are dying from it, and second, it would be paraded as an excuse for the proponents of cheap money and debt spending to not learn their lesson again. They’ll just blame the virus and not the monetary monstrosity that has been created and then proceed to do it all over again, or even more so than before. It’s already heading in that direction anyways as central bankers across the globe are already in full denial mode.
COVID-19 may not be a medical pandemic, but it is rapidly becoming an economic pandemic and perhaps soon a scapegoat.
For the actual medical risks, read my earlier article about the real dangers of COVID-19: