Trying to sort through all the details about COVID-19 is a challenge for all of us when there is so much information and misinformation out there.
The great claimer of “Fake News” is one of the sources of actual Fake News: ingest or swallow Lysol? Really?
And then there are the conspiracy theorists who invent their own view of reality, selectively choosing information to make their case, and misrepresenting known facts or fabricating their own. Unfortunately these theories get passed on through social media and appear to be the truth.
One such speculation is that the COVID-19 came out of a lab in China and that there is a grand plan for the country to profit through the sale of needed products throughout the world.
The reality is that China had geared up to deal with the initial outbreak of COVID-19, including quickly building a number of 1,000-bed hospitals. Included in the build-up would have been production of masks, gowns and other treatment of supplies and equipment.
We need to remember that China is not “all Red” as often assumed about Communist countries. It is both a Communist and a capitalist society, with many entrepreneurs.
Now that the virus is somewhat under control in China, the capacity is available for export. And as always happens when there is a perceived large market, many firms enter the market and overcapacity in the new industry occurs.
We will see the same thing happen in North America with overcapacity and great surpluses once the virus becomes mostly under control.
China is always a fascination for us. China “has a plan” and is aggressively expanding its presence around the world. One thing it is doing is buying port and other facilities in many countries. Better to buy a country than to go to war and destroy all the facilities and infrastructure through bombing.
And where does China get money to buy up distressed or other businesses? From profits from being the production centre for the world. We are the buyers of Chinese goods and therefore are contributors to their plans.
The current outbreak of COVID-19 is very clearly having a serious impact on the health of both people and the economy. While we are dealing with this as best we can, when and how we will come out of this crisis is still uncertain.
But what is clear is that there will be some long-term adjustments. Whether many learn from the current crises is yet to be seen.
Those whose parents who were greatly affected by the Great Depression, will remember the impact it had on them and how careful they were afterward about how they spent and saved their money “for a rainy day.”
What we have had is not just rain but a storm. The possibility of a rainy day suggested that one should have at least one month of expenses in the bank, preferably three months.
But when you are maxed-out, the only hope is Big Government support. Will lessons be learned or will society go back to believing that you can borrow and consume and live up to the max of your credit score and, in time, give your home to lenders though reverse mortgages to support a perceived lifestyle, hoping that you don’t live too long?
As someone once said, this too will pass! Here’s to a brighter future.
In the meantime, keep safe and keep well. And as Red Green would say as he closed out his show, “We’re all in this together.”