top of page
Writer's picture© Shane F Smith

Letters on Coronavirus and Economic Contagion

Updated: Aug 21, 2020

12/03/2020

Dear Friends and Family,

I am in Coronavirus-free Malindi (at least as far as we know), on the Kenyan coast. It is an Italian tourist Mecca – they own the place, but there is almost no one here.


A friend and I went to the "Billionaire Resort" here the other day, and normally we would not be allowed in, since we are a rung down on this ladder, but it's almost peak season and the place was empty! Nearly all Italians have gone home because Italy announced that after a certain date they will be locked out of Italy for the count. The waiter said that last week they were booked out, but all at once everyone disappeared.


So here we were, travelling in a Took-took (three-wheeled Indian motorised Rick-shaw), allowed to ‘put-put-bang-put’ into the Billionaire Resort and eat like kings. It is a very large resort, and we were the only ones there!


You will notice we took a photo of one cool, calm and collected, presumably billionaire, with no thought of coronavirus or any other problem in the world. At least there are some who can still relax about this.


I am ready to take my flight back to Moldova at the end of the month, to pick up a newly painted, Soul-Red-Crystal-MetallicCitroen CX, and I am pleased to see there is still only one case of the dreaded "C" in Ukraine, where I will be driving to. But I have decided to monitor the situation closely, because I don't want to get stuck in a country where I am not covered for medical costs with Corona. And getting my body back to Australia is fraught with difficulty anyway!


I gave you my 'back-of-a postage-stamp' calculations on Italy's death rate from Coronavirus, which I calculated to at about 4.3% last time. China suggested 2% initially and then the WHO lifted it to around 3.4%. But I just did the same calculation again -- and Italy is the only country we can confidently rely on the figures -- and now they come out at a 6.6% death rate!! That's pretty serious. I am no expert in pathology or any other 'ology', but that's what they come out at on the raw data.


I have watched a few real experts on it, and they are saying the compounding rate of transmission is what nobody is seeing. It is 1 case now, 5 cases in two weeks time, 15 cases three days later, 40 cases two days later... then BOOM!!


While I feel Australia seems to be fairly vigilant on the situation, and am the last one to harangue poor old ScoMo [Prime Minister Scot Morrison] (because I think he got a very bad wrap over the bushfire situation), I still think we should have stopped flights from China 2 weeks before we did, and flights from Iran should have stopped immediately we heard their politicians saying they didn't need to close anything down in the epicentre, Qom, and that it was not such a serious situation. The bloke who gave this announcement was mopping his brow and coughing as he mounted the podium to speak on it, coming down with Coronavirus, and one of his advisers died a couple of days later. Talk about Karma!


Now we have drivers in the Grand Prix with Coronavirus, and a six-time champion wondering why we are still planning on holding it! The Premiere of Victoria or the Prime Minister should step up to the plate and say we are running it without spectators. Otherwise, it will be 1, 3, 14, 60... BOOM!


I have also attached a photo of a new set of Australian designed earrings if any of you would like to buy them for your loved one. They combine our newly acquired Aussie passion for toilet paper with another passion which will soon sweep the country, possessing real gold.

Regards,

Shane


Dear Friends and Family,

You can relax, as this is not going to be a daily post. It's just that Kenya, which had been trying its darndest to acquire Coronavirus, albeit unsuccessfully until now, has finally nailed it.


Kenya has been welcoming all comers, especially from China (who are difficult to stop because they own a large part of the infrastructure in the country and are Kenya's biggest creditor), and also from Italy, whose citizens own a large part of the coastal tourism enterprises. Kenyan politicians have been singing, "Come all ye faithful, joyful and triumphant... Come ye, oh come ye with bul-ul-ging wallets" (sorry if it doesn't rhyme for you.... it seemed to for me!)


But finally, after a massive attempt, they have been successful. The first case arrived by plane from Britain via USA, and fortunately for all Chinese and Italians, it was a Kenyan.


Kenyan authorities have announced that the main hospital in Nairobi has allotted 11 beds for Coronavirus cases, so I am sure that will allow the residents of Kibera to sleep securely at night. Kibera is the largest slum in Africa, located right in Nairobi, but is only one of three massive ones here. Most residents don't have running water, and some don't have electricity, and as you can imagine they are jammed together like sardines in a can, and most could not even contemplate health insurance. The conditions on the street in these slums are filthy, although in their mud and concrete hovels these people are spotlessly clean. But something like Coronavirus running unfetted through Kibera is a horrific thought. Buying toilet paper by the trolley-load will not be their priority. Panic will ensue.


I will be on a plane somewhere before then, but who knows where. The world is my oyster, as they say, although the oyster has been shrinking fast lately. I have been thinking I will fly back to Australia, with a stopover in Antarctica.


Even Moldova has the dreaded "C" now. My mechanic friend there says no one is coming to Moldova now. I don't know what he has been smoking though, because no one ever did go to Moldova, in my experience! They have very good wines there I hear – they certainly need something like this, because it is the most boring place imaginable.


I hesitate to make prognostications on the economic side of Coronavirus at this point, as someone is bound to take offence and I will be asked to remove them from my mailing list, but here goes.


All political leaders are duty-bound to spend to stave off this virus for as long as possible, to ‘flatten the curve’ as they say, and to save as many souls as possible. Time is our saviour at the moment and we must slow it down so the system is better able to cope. Of course eventually everyone is going to get it. I hope it will not follow the death rate I gave for Italy, because in this scenario, of the 7.5 billion people on the planet, even at 2%, this is 150 million, and at 6.6% it comes to 500 million. We hope we will not all contract it at once because mathematics is a scary discipline in this instance.


I am in total agreement on spending to buy time to stave off the disease (note, this is the second time I am saying this!). But spending huge amounts of money in a vain attempt to stop a recession (or more likely depression), is a futile endeavour, in my mind. The precursors of this economic situation we have tailor made for ourselves over at least the last decade, and a good case can be made to say they have been building for multiple decades. I understand that keeping people employed is extremely important in such a time, but I don't believe it is in the power of any leader to circumvent a depression. Economics 101 will over-rule them.


The response to the GFC 11 years ago by political leaders worldwide was to spend their way out of it. Unfortunately, they have become infected with a spending virus and they already flagged months ago that this would be their response to the next episode.


This was the response of Franklin D. Roosevelt at the time of his election during the depths of the Great Depression, and at that time it was perhaps the correct response. He instigated unemployment benefits, a great initiative, contracted the working week to 40 hours, raised the minimum wage massively and made overtime rates prohibitive (to encourage employers to put on unemployed people instead of paying current employees for longer working times), and instigated massive public infrastructure projects. This all helped a great deal, which is probably why he ended up calling it the "New Deal"!


Actually, after doing some research, I understand that this route did not make much difference to how quickly the depression came to an end. Australia took a different, conservative path, balancing the budget and allowing wages to fall somewhat, and we came out the other side in much the same shape as the U.S. of A. We had unemployment benefits before America as well.


But things are different this time. We went on to not only accept Roosevelt’s plan after the depression and to build on it massively. We not only pay unemployment benefits, but have added free medical insurance, pensions for everything imaginable, student loans that sometimes never get paid back, and I am not going to mention the aged pension at a time when a huge wave of Baby-boomers are retiring together. Note, again, the aged pension is a great idea, I am simply explaining the demographics of the Western world at the moment.


We have come to expect economic perfection in the Western world, when it may not be possible, or even desirable. The demographic situation is a hidden mine-field. Retirees do not need to spend much money, they don't travel to work, hopefully many of them own their homes (it's only the unfortunate like myself who move from park bench to park bench each night), and they can curtail international travel on a whim. In a word, they can sit at home, eat baked beans and watch Tele for as long as it takes. And once they slide into that stream of thinking, they possibly will make it a way of life – saving paper-bags and all.


This could cripple the economy in itself, without Coronavirus or a public debt that threatens to sink the boat, with no way of plugging the hole (yes I know I didn't mention there was a hole... I'll rethink that one!).

Are you waiting for a solution to this problem from me? You will have to wait a little longer for that, but one thing I do know is you can't think you can continue indefinitely printing money and spending your way out of any and every difficulty. Probably the solution will involve a lot of pain at some point, followed by conservative economic principles coming back into fashion. It may even involve totally novel ideas like paying off debt and balancing budgets, whether households, companies, or countries.

Regards,

Shane


14/03/2020

Dear Family and Friends,

Stop Press!

After Kenyan authorities announced the first case of Coronavirus here on Friday to great fanfare, and supermarkets were cleaned out Saturday morning, we now have a revision to make, because the woman named as the Coronavirus case posted a video on social media claiming she not only did not have the virus, but she was not even in the country at the time!


Several Kenyans I spoke to ungraciously suggested that the hunting around to name a case, any case, closely followed the announcement by the WHO that they had allocated $1 billion to be split between African countries who had the virus!


Someone got it badly wrong, of course, and now they will have to try a little harder to find a case, because which self-respecting African politician would want to miss out on a slice of a free handout?


I have finally decided to come home, since Ukraine is barring the door to me anyway, and my car can continue being painted in my absence (they gave me assurances the colour would not change if I were not present).


I will not be disclosing the date or time of my arrival and I will be self-eradicating for three months in a location disclosed to no one. I have already arranged directly with Heinz to deliver one tonne of Baked Beans, and my only worry now is finding toilet paper, which I could not locate for love or money! My colleagues are at this very moment installing an exhaust fan to the bunker.


I will be dosing up on my own concoction of garlic and ginger mixed into coconut cream for the flight home. I don't expect any passengers wanting to remain next to me for very long, and I may even get upgraded to a 1st class cabin, we will see. I procured two surgical grade masks and 50 other masks to be worn concurrently (not 50 at one time mind you), and will not eat for the duration of the flight.


After the 3 months quarantine, if I survive the baked bean regime and escape the dreaded "C", I hope to start building my house, which I have now modified to be virus-proof and fitted with a built-in baked bean odour filter.


If any of you are still around after this time, I will be happy to bump elbows with you in future.

Regards,

Shane


17/03/2020

Dear Family and Friends.

This is the last email you will get from me before I enter my term of self-immolation. I hope to come out the other side a changed man - gone with all the bacteria, viruses and dross.


Actually... I will be happy just to come out the other side!


I have been assured the one tonne of baked beans has arrived at the bunker, but unfortunately all they could find was half a roll of toilet paper, and they had to wrestle that from an old woman as she emerged from the supermarket. I don't know how it will match with the 2,305 cans of baked beans, but all I can hope is that Mr. Heinz has come up with yet another magical variety.


I won't be calling or texting you for the entire period of my self-incarceration. You know how mobile phones harbour all manner of bacteria, viruses and grime, and I don’t want any chance you will catch something from me via these. Even emails harbour viruses, but I made sure Bitdefender did its job on this score.


I hope by the end of my three months of self-sequestration you people will have gained some self-respect when it comes to toilet paper? I mean, get a grip on yourselves, for heaven’s sake!

Regards,

Shane


6 views0 comments

Comments


bottom of page