Covid 19: the pessimisstic view
I have been talking to too many IFA, CEO, CIO, and even one owner of a mutual fund. Most of them think that the virus is something which will go away in a month or 2 and things will be back to normal.
The only journalist that I am following is Shekhar Gupta (The Print), and I can tell you that I am not a big fan. However, i do think that he has covered the Corona virus well. Well, as much as I can understand.
Then I spoke to somebody whom I have known for the past 20 years – as a pharma analyst. He is half a doctor for all practical purposes. Also spoke to another friend who has seen pharma research outfits do research for creating products.
One thing which emerged was that Indian pharma industry is not really the place where cutting edge technology research gets done. His guess is that the vaccine will emerge from US, China or even Israel.
My take is different though. Even if we do RESEARCH and find a vaccination, that would be the research part. Then there will be the development part – which in what I have seen could take about 12 months (at least). So asking for 12 -24 months for some kind of a solution to be visible to the market is a fair enough assumption.
After the development, the vaccine will have to be MANUFACTURED and given to 7 billion people. Manufacturing vaccines at such huge quantities is not going to be easy – and the whole world needs it! Assuming 2 companies find a solution will they be good enough to give the solution to the whole world? Will the vaccines be distributed on money power basis, political basis or humanitarian basis? will Donald Trump even share it with states where his rivals are in power?? Politically will we trust a solution that comes from China? And even if they give will they give it without any political price? We do not really have a solution for that.
The Corona virus is in the same family as the flu. The amount of money spent on finding a cure for flu is not funny. There are vaccines to protect you against the flu – but it does not work for more than 6 months. You can’t fault the amount of money and effort spent on finding a solution, but hey it does not work. Now what happens if Corona treats us like that?
So if we do not have a solution for 2 years – except social distancing – how will we run our factories, farms, hotels, gyms, swimming pools,….- remember there is commerce to all of this. Just goes for a toss.
Am I being pessimmistic? well I do not think so. I have not yet got into the numbers. I am starting by believing the numbers – because it is too painful to dig deep. Right now I have neither the energy nor the inclination.
The worry for us is the slow lifting of the restrictions in South Korea and China – which had a relapse – 115 of them. This is scary.
I think this whole thing will take about 24 to 36 months. I hope I am wrong.
Mohan
your thoughts are similar to mine. this is going to be then new normal going forward for many years to come.
Krish
Couldn’t agree more about US, China or Israel coming with Vaccine. Guess it needs half a billion USD to concurrently carry out research and testing various formulations. Indian companies doesn’t have this kind of resources unlike US with VCs, China & Israel with Govt backing.
Once the vaccine is out, confidence builds up and people will no longer be scared knowing there is a cure unlike today. That confidence is enough to move on and don’t think everyone need to be administered with this vaccine.
As the research picks up and scientists starts to rip off the COVID virus characteristics, am pretty confident that lot of solutions would emerge other than the vaccine. People are already talking about Plasma. Antibodies and Generics also will emerge to build the immunity. Not sure of dooms days theory prolonging to 24-36 months.
asmi
Sir,
As we are not presently testing extensively, what we are seeing are only the most severe cases…
In a good case scenario, it could also happen that testing more and more ppl would reveal majority of asymptomatic or mild infections…. that will improve our confidence… also we may in time identify select populations with higher risk and take precautions….
shinu
same feeling as your thoughts… but surprising is the market reaction to it – much optimistic than any burst the history (mostly regional or even country or industry specific) say in half a century. WHY. that too for this worldwide pandemic stretching months or years. VERY STRANGE
rsreedhar
Sir, I am your follower for quite sometime now and i have read almost all your blogs and all of them has provided me positive vibes in one way or the other. Probably the first time, your blog has created a negative vibe. That tells how bad the situation could end up.
Dhanesh
I don’t think your assessment is pessimistic. . It’s ridiculous. .
dhayaneethi sabhapathy
Deaths due to other diseases like Malaria or Flu are more than Covid 19. Previously suddenly old people die due to some health issues and no body try to find out why they are dead. Indian people already developed immune unlike western countries where sanity, cleanliness is more. US babies cannot walk in our Indian floor without proper protect and they will fell ill. OUr babies will roam around without underwear and nothing infects them.
So Corona will pass through once lock over is lifted.
Deepak
Size Orman just called for 3years emergency fund! How things have changed in one month, reset is coming!!!