The Economic Perspective: “Coronavirus Chaos”
This is Mary Walden with economist MW welcoming you to the economic perspective. Today’s program looks at coronavirus chaos. Mike, the coronavirus has suddenly hit the world. Thus far, the number of people infected in the US has been very low. Still, there have been adverse impacts in our country, particularly for investors. Why are people worried about the coronavirus?
Mike: Summary Answer
- Because if spread worldwide to large numbers of people, can wreck the economy
- Already seeing economic contraction in China where virus began
- For US, even if few infections, businesses can be impacted by reduction in products and inputs they buy from foreign sellers, as well as reductions in sales to those countries
- Worries recently captured by an over 1000 point decline in one day in the DJIA – about a 3% drop
- Investors don’t like uncertainty – flee to safety – lower interest rates
- So this is something to watch, if for no other reason for the economic impacts
- Fortunately, our history with viruses is they are short-lived.
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.