Initially, I called for calm with the COVID-19 coronavirus outbreak until further data could be assessed, as diseases are known to be sources of market fluxuations and panic used for political gain. However, as I have also noted, upon seeing the spread of the disease and its sources and potentials, I have said that people need to act prudently by purchasing as much as they need from Chinese-made sources right now because the virus is threatening to cause long-term damage to Chinese supply chains, which have direct implications for American consumers.
The impacts of this were seen this morning, as the dow dropped 800 points following supply chain disruptions caused by the virus as CNBC notes.
Stocks fell sharply on Monday as the number of coronavirus cases outside China surged, stoking fears of a prolonged global economic slowdown from the virus spreading.
“The second-largest economy in the world is completely shut down. People aren’t totally pricing that in,” said Larry Benedict, CEO of The Opportunistic Trader, adding a 10% to 15% correction in stocks may be starting. He also said some parts of the market, particularly large-cap tech stocks, appear to be over-owned. “It seems like there’s much more to come.” (source)
If anybody thinks this is serious, one is gravely mistaken. This is NOTHING in comparison to what lies ahead in the future.
China is the second largest economy in the world and has been made dependent on the US. If she cannot manufacture, the US cannot consume, and so China shuts down.
People do not want to go back to work because they are in fear for their lives. This is legitimate, since the virus has killed many people already.
As I have said before, if production does not resume soon- and the Chinese government may force it at gunpoint -China faces the real possibility of internal economic collapse and the collapse of the CCP.
You can’t stop politics, but you can help yourself.
Consider going to the store and stocking up on tools. You will be thankful come September.