The Covid-19 recession is the first stock market crash in history that was caused by a pandemic. From the Tulip mania bubble in 1637 and all the way to the Financial Crisis of 2007-08, all panics to date were entirely man-made. Not this one though. This time it’s different (?). The current pandemic has brought the world to stand still and caused stock exchanges globally to crash when other health catastrophes in recent history didn’t even cause the markets to yawn, as the graph below clearly shows.
But why is that exactly?
It really does feel at times like the world has come to a premature end right? As Covid-19 spreads entire nations are forced into lockdown. The death toll is rising. Millions are losing their jobs. Governments are announcing huge stimulus to save their economies. Quantitative easing measures are back. Trillions wiped off the markets. Pensions and lifetime savings gone. The elderly staring in horror at empty supermarket shelves. The media is screaming at us that we’ve ain’t seen nothing yet! Load up your guns, put on the ski mask and storm the toilet paper shelves!! And do it fast – The end is nigh !!!
But wait, hold on for a second. How did we get to the scary part so fast? Why is it that 17,000 annual deaths in Italy, the Covid-19 epicentre, from seasonal influenza are perceived as “business as usual” but 4,825 Corona deaths have managed to crash the Italian stock exchange and cause panic hoarding of groceries within days? How come 40,000 annual deaths from influenza in the US get barely a mentioning on CNN but 1,753 corona deaths have already caused the fastest crash in the history of Wall Street and panic buying of cans of beans and military grade weapons by thousands of American citizens? And why did we run out of toilet paper this time when during the peak of AIDS 2005-2012, 36 million deaths (!!!) caused no shortages of any kind in our supermarkets?
It appears that mankind just managed to manufacture the first post-truth era mass “run to the bank”. The WHO recently declared a global pandemic, and rightfully so. This pandemic is dead serious. But the part that is largely forgotten is that the WHO also declared the amount of fake news and misinformation around the Covid-19 epidemic as an ‘infodemic’. In a press conference already in February, WHO director-general, Dr Tedros Adhanom Ghebreyesus said misinformation was “making the work of our heroic workers even harder”. Dr Tedros added: “At the WHO we’re not just battling the virus, we’re also battling the trolls and conspiracy theories that undermine our response.” Imperial professor of public health Helen Ward explained recently: “There is an enormous amount of misinformation, which can spread rapidly on social and mainstream media causing distress and panic, potentially undermining the public health response.” It appears we’ve been battling two pandemics all along, not one, and whilst we are gearing up to win Covid-19 we are losing hands down to the Infodemic phenomena.
How did we let this happen? Perhaps we don’t seem to entirely appreciate the power that we store right in our fingertips. With every status update and every share, with every article we send each other on WhatsApp and every tweet we make, we are unknowingly writing the future of our species. It’s entirely within our capacity to stop the stock exchange from crashing and with it the wiping off of the pensions and savings of those who need them the most right now, to leave toilet paper and food for the elderly and NHS workers on the shelves, to support our friends and relatives by showing optimism and a fighting spirit instead of spreading half checked misinformation, depression and alarmism. It’s within our abilities to check before we share, to think before we broadcast, to “mute all” before we dive into our Facebook app, to spare the world negativity and contribute to what could be remembered as an incredible victory of mankind over Covid-19 and the end of the post-truth era.
This is entirely up to us.