SARS and ebola

Two preliminaries:

–Alan Kaplan, a reader, attached an AP article to yesterday’s post that says that 16 staff members of Doctors Without Borders have been infected with ebola and nine have died.  This contradicts information I got from Bloomberg on Monday that none had been infected.  A health expert was using this “fact” to buttress his case that although the protective protocols for health workers were very difficult to carry out they were effective.

Thanks, Alan.

–a second nurse in Dallas who had been caring for ebola victim Thomas Duncan has been diagnosed with the disease.  Reports I’ve heard this morning suggest the hospital was woefully unprepared and that few safety protocols were in place while Mr. Duncan was being treated.


This is my mainly subjective, investment-oriented, account of the SARS period.

–SARS emerged in Guangdong province in southeast China sometime in 2002.

–The disease is spread by coming into contact with respiratory droplets from coughs or sneezes of someone infected.  SARS can also be contracted by touching an object or surface where droplets have landed and then touching the mouth, nose or eyes.

–The World Health Organization says that 8098 people worldwide contracted SARS during the 2002-03 epidemic, of whom 774 died.  In the early days of SARS, however, and for a period of at least several months, Chinese officials suppressed information about the disease.  So it’s not clear how accurate these figures are.  .

–Treatment, as I recall from reports at that time, is long and painful.  Recovery may be far from complete.

–two factors contained the spread of the disease outside China:  at that time is was not as easy as it is today to get official permission to leave the country; and most exit routes led through Hong Kong.  So Hong Kong acted as a choke point for screening and potential quarantine.

–within China, once Beijing began to take preventative measures to contain SARS, factories were quarantined and closed for weeks at a time.  This not only affected the production of Chinese goods, but also foreign production of end products that used Chinese components.

–for a period, port workers in Hong Kong and elsewhere refused to handle shipments of goods from China, reasoning they risked contracting SARS from touching surfaces where infected persons might have coughed or sneezed.

–Travel to Hong Kong dropped sharply.  Business travel from Hong Kong did as well, since clients/colleagues were not eager to schedule meetings.

–Investors closely monitored reports of new cases in Hong Kong, looking for deceleration of the rate at which the disease was spreading.  The time of maximum concern lasted from the initial reports from China in November 2002 until June 2003.

–the S&P 500 dropped by about 10% from mid-November 2002 through early March 2003.  It’s hard to know how much of this decline was due to SARS, since world markets were still working through the aftermath of the implosion of the Internet bubble in 2000.  Markets bottomed in March 2003;  economic revival propelled them sharply higher from that point.

…vs. ebola

–ebola appears to be harder to contract than SARS, but the fatality rate is much higher

–colonial-era ties between Africa and the EU mean there are more routes an infected person might take to other areas of the world

–Africa is not yet the manufacturing powerhouse that China was in 2002.  So the indirect effects of quarantine on the rest of the world will be potentially lower

–as was the case with SARS, the biggest potential stock market losers will likely be travel, tourism and entertainment related.  I think Europe is the area outside Africa most likely to be negatively affected.

–I’d think that, by analogy with SARS, it will take six months of global government effort to contain the outbreak.  If so, we’re still in early days of concern about the disease.


Leave a Reply

%d bloggers like this: