I'm sure most of us have seen a chart similar to this at some point within the last few days, but it bears repeating in light of a lack of serious analysis and explanation in most media outlets (who are more focused on politics and opinions instead of facts). This failure on the part of the media has led to generating an unnecessary amount of fear. In large groups of people, emotions such as fear tend to win out over logic, as any seasoned trader should know.
A lot of people are panicking because they believe that everything shutting down must mean that this virus is exceptionally dangerous and deadly. This appears not to be the case. Instead, everything is shutting down in order to slow down its spread to a more manageable level. This is a normal epidemiological response to a rapidly spreading infection. COVID-19 is a highly contagious virus and it is likely that everybody will catch it at some point in the next several months. This is probably unavoidable. However, if the released data are accurate, it seems be causing serious problems for only the elderly and people with compromised immune systems.
So why shut everything down?
In the chart, everybody gets infected in the end no matter what, but if everyone gets infected too fast, there will be more of those serious cases than hospitals can handle. There won't be enough hospital beds, doctors, nurses, etc. to be able to keep up with the number of people that need help. This is represented by the red curve. You can see how the red curve accelerates upwards so fast that it quickly exceeds the total capacity of the local healthcare system represented by the dotted line.
Instead, if everything is shut down for several weeks, you slow the rate of the infection spreading by preventing large crowds from mingling. In the end, everyone still gets infected, but it takes place more slowly. This means that the serious cases still happen but at a rate that is manageable by the hospitals. Stretching out the infection to a longer period of time makes sure there are always enough hospital beds to keep up with the most serious cases. This is represented by the blue curve which never surpasses the capacity of the healthcare system but takes more time to play out.
Keep this in mind when you see people panicking and hoarding a lifetime's supply of toilet paper.
Don't let fear beat logic.
My name is Yrat and thank you for coming to my TED talk.
A lot of people are panicking because they believe that everything shutting down must mean that this virus is exceptionally dangerous and deadly. This appears not to be the case. Instead, everything is shutting down in order to slow down its spread to a more manageable level. This is a normal epidemiological response to a rapidly spreading infection. COVID-19 is a highly contagious virus and it is likely that everybody will catch it at some point in the next several months. This is probably unavoidable. However, if the released data are accurate, it seems be causing serious problems for only the elderly and people with compromised immune systems.
So why shut everything down?
In the chart, everybody gets infected in the end no matter what, but if everyone gets infected too fast, there will be more of those serious cases than hospitals can handle. There won't be enough hospital beds, doctors, nurses, etc. to be able to keep up with the number of people that need help. This is represented by the red curve. You can see how the red curve accelerates upwards so fast that it quickly exceeds the total capacity of the local healthcare system represented by the dotted line.
Instead, if everything is shut down for several weeks, you slow the rate of the infection spreading by preventing large crowds from mingling. In the end, everyone still gets infected, but it takes place more slowly. This means that the serious cases still happen but at a rate that is manageable by the hospitals. Stretching out the infection to a longer period of time makes sure there are always enough hospital beds to keep up with the most serious cases. This is represented by the blue curve which never surpasses the capacity of the healthcare system but takes more time to play out.
Keep this in mind when you see people panicking and hoarding a lifetime's supply of toilet paper.
Don't let fear beat logic.
My name is Yrat and thank you for coming to my TED talk.