WHO's Pandemic Alert On Swine Flu: Real Pandemic Threat Or Other Unspecified Motives?

The Swine Flu has officially been declared by the WHO as a pandemic.
This from the Economist, ``THE World Health Organisation raised the threat level for swine flu on Thursday June 11th to pandemic status, the highest possible. It is the first influenza pandemic since 1968, when Hong Kong flu killed 1m people. Almost 28,000 cases of swine flu and 141 deaths have been confirmed in 74 countries since the A(H1N1) virus was first identified in Mexico in late March. In Australia alone, the number of people infected has jumped from around 500 to 1,200 in one week. However, in a new paper published in Nature on Thursday, researchers suggest that the strain had probably been in existence for months before it was isolated, highlighting the need for good surveillance."

I'm no health expert, but I remain a skeptic.

The figures are telling; 141 out of 28,000 cases translates to a .5% fatality rate. The 1918 pandemic had a case fatality (CF) ratio of 3-6% according to wikipedia.org.

Moreover, 28,000 cases in 3 months against a world population of 6.7 billion doesn't seem to project anywhere near the same degree of impact relative to the 1918 case.

Then, some 25 million people had reportedly been killed during the first 25 weeks of the outbreak according to wikipedia.org.

Of the world population of approximately 1.6 billion, estimated fatalities for the 2 year lifespan of the pandemic reached a third or about 500 million-again from wikipedia.org.

Under the same rate, we would now have tens of millions of infected people and casualties that would run in the hundreds of thousands if not in millions.

Of course, one may argue that- this is what the pandemic alert is for-to prevent the spread of the disease and fatalities!

But where should the line be drawn between the use of "fear" from pandemics (or as an excuse) for expanded government control of our lives and the real menace of swine flu as pandemic? Or how do we know if the pandemic alert is genuinely about disease prevention or about some implicit interests being foisted on us by government/s? How do we know if this isn't about propping up sales of pharmaceuticals, some of which are said to be partly owned by certain politicos or a thrust to impose global taxes or other concerns outside of the pandemic issue?

See past articles:
Swine Flu: Mostly A Media Fuss
Swine Flu: The Politics of Fear and Control
Swine Flu: The Black Swan That Wasn’t

Update on Tracking Swine Flu's Global Reach

An update on Swine flu's global tentacles.

According to the Economist, ``THE annual meeting of the World Health Assembly this week has been dominated by swine flu, as the number of cases continues to climb. Over 400 cases have been confirmed since Monday May 18th alone; Greece is the latest country to report a patient with the (A)H1N1 virus, bringing the number of countries with infections to 41. Of the 80 people that have died, most were in Mexico, where the infection originated. Neighbouring America accounts for over half of the world's reported cases. Global efforts will now focus on ensuring that developing countries have sufficient vaccines."
So far the hysteria on swine flu seems to have been somewhat dissipating even as the disease have spread to far more corners of the world.

The Google trend above shows of the public's diminishing concerns as swine flu searches have materially waned.

Gallup has also the same observation.

Nonetheless as long as the flu doesn't mutate, whose origin has been heatedly contested (claims of human error being investigated), the impact should be contained.

So far this episode has been mostly a media hype based on government alarmist mien, which has been validating our thesis...see our previous posts:

Swine Flu: Mostly A Media Fuss
Swine Flu: The Politics of Fear and Control
Swine Flu: The Black Swan That Wasn’t

Swine Flu: Mostly A Media Fuss

I was supposed to write something about the seeming fear mongering by media on the swine flu, but the Associated Press beat me to the punch.

Here is an excerpt (all emphasis mine)...

``The so-far mild swine flu outbreak has many people saying all the talk about a devastating global epidemic was just fear-mongering hype. But that's not how public health officials see it, calling complacency the thing that keeps them up at night.

``The World Health Organization added a scary-sounding warning Thursday, predicting up to 2 billion people could catch the new flu if the outbreak turns into a global epidemic.

``Many blame such alarms and the breathless media coverage for creating an overreaction that disrupted many people's lives.

``Schools shut down, idling even healthy kids and forcing parents to stay home from work; colleges scaled back or even canceled graduation ceremonies; a big Cinco de Mayo celebration in Chicago was canned; face masks and hand sanitizers sold out — all because of an outbreak that seems no worse than a mild flu season.

``"I don't know anyone who has it. I haven't met anyone who knows anyone who contracted it," said Carl Shepherd, a suburban Chicago video producer and father of two. "It's really frightening more people than it should have. It's like crying wolf."

``Two weeks after news broke about the new flu strain, there have been 46 deaths — 44 in Mexico and two in the United States. More than 2,300 are sick in 26 countries, including about 900 U.S. cases. Those are much lower numbers than were feared at the start based on early reports of an aggressive and deadly flu in Mexico.

``Miranda Smith, whose graduation ceremony at Cisco Junior College in central Texas was canceled to avoid spreading the flu, blames the media.

``"It's been totally overblown," she said Thursday.

Well speaking of "overblown" and "breathless media coverage" Pew Research shows of how the epidemic scare has eclipsed all other topics.
According to Pew Research, ``Yet all those stories were overwhelmed by the frantic coverage of a new flu virus that in a matter of days had made its way around the globe and was threatening to become the first influenza pandemic in four decades. From April 27-May 3, the swine flu, or H1N1 as it officially became known, accounted for nearly one-third of the newshole (31%) studied, according to the Pew Research Center's Project for Excellence in Journalism."

It is understandable for media to revolve around sensationalist news simply because its fundamental incentive is to generate more audiences. And when fear or panic is in the air, the public gropes for information to which media obliges.

But for governments, aside from the "social service" function, the unstated incentives may vary from expanding government control, desire to increased access to funding, or cronyism as discussed in Swine Flu: The Black Swan That Wasn’t and Swine Flu: The Politics of Fear and Control.


Yet according to Gallup, Americans appear nearly evenly split between those who say that media coverage of the swine flu had been exaggerated and those who say media coverage was just right.

But I don't think this will last.

The subdued impact from the swine flu infestation has reduced fear as shown by the Gallup survey above. Note that at the peak only 25% of those surveyed said they were personally worried by the Flu which means 75% were not. Now only 17% are concerned, which implies 83% aren't.

This suggests that, despite the intensive media coverage, the American public hasn't been cowed into panic. This further implies that media has indeed overhyped its coverage of the swine flu.

This declining trend of swine flu scare has likewise been apparent in Google's search trends. Thus eventually I expect more converts to the exaggerated camp for as long as the spread of the disease do not worsen.

Lastly, congratulations to world boxing legend Manny Pacquiao not only for a stunning triumph in his latest quest for glory but also for defying authorities who had been trying to curtail his civil liberty from a vastly inflated health scare.

Swine Flu: The Politics of Fear and Control

The swine flu "hysteria" continues to hug the headlines where the latest Bloomberg report says,

``Swine flu, also known as H1N1, has been confirmed by laboratory tests in 1,516 patients in 22 countries, according to the WHO. Mexico has reported 942 cases, including 29 deaths, while the U.S. has 403 cases and two deaths, officials in those countries said. Canada has 165 cases."

Hysteria because fear foisted upon by media, politicians and experts has spurred irrational reactions. For instance, we read with incredulity that some of Tokyo's hospitals have reportedly refused or turned away patients exhibiting flu-like symptoms.

According to the Japan Times, ``An increasing number of patients running a fever have been rejected by Tokyo hospitals that fear they may have swine flu even though the risk of their being infected is minimal, the metropolitan government said Tuesday.

``The number of cases in which hospitals refused medical examinations for such patients totaled 92 from Saturday morning to Tuesday noon, a survey by the metropolitan government found.

``"We want hospitals to respond calmly even if they fear that patients infected with the new flu may appear or that other patients will get infected," a Tokyo official said." Those inflicted by Flu have effectively become castes.

And yet we have experts compounding these sentiments by associating flu epidemics to economic depression.

Take for instance this op-ed from Wall Street Journal by Robert Barro and Jose Ursua (emphasis added),

``Our ongoing study of economic disasters for 36 countries since 1870 suggests that this concern is well founded. In this sample, we have isolated 158 depressions -- defined as declines in a country's real per capita gross domestic product (GDP) by at least 10%. The most prominent features of these depressions are wars and financial crises. But the fourth-worst global macroeconomic event since 1870 seems to be the Great Influenza Epidemic of 1918-20. This "health shock" accounts for 13 of the depression events. In contrast, World War II is associated with 25, World War I with 23, and the Great Depression of the early 1930s with 21.

``The Great Influenza Epidemic (aka the Spanish Flu) began in spring 1918, went through three or four waves, and lasted into 1920. The spread of the disease was propelled by international travel, much of which involved troop movements in 1918 because of World War I. Estimates of world-wide flu deaths cover a wide range but are typically around 50 million.

``We have, thus far, compiled estimates of excess deaths from the flu in 1918-20 for 32 of our 36 countries. The median excess mortality rate was 0.7 per 1,000 people, with a range from 0.1 for Argentina to 4.4 for India and South Africa. (The mean rate was 1.1 per 1,000.) Spain, forever associated with the flu, had a mortality rate of 1.2 per thousand, well above the median. The United States, at 0.65, was close to the median (there were 675,000 American deaths). When applied to today's U.S. population, this rate would translate into two million fatalities....

``The troughs in macroeconomic activity that we associate with the Great Influenza Epidemic were typically in 1920 or 1921. Not all of our 36 countries showed economic declines in this period. But on average the fall in real per capita GDP from the previous peak in 1918 (or sometimes 1919 or 1920) was 6.6%. (For the 24 countries with data, the average decrease in real consumer spending per person was similar to that for real per capita GDP.) Notable declines in GDP among the 13 depression cases were Canada and South Africa at 24% and Italy at 22%. For the U.S. from 1918 to 1921, the falls in per capita GDP and consumer spending by 12% and 14%, respectively, meant that this contraction was second in size since 1870 only to the Great Depression."

The problem with looking at history is that it may be seen from a one dimensional lens.

This isn't 1918. Today's economic climate is far different from the Great Depression.

While travel and troop movements may have been accounted for as the aggravating circumstances for the spread of the disease, this hasn't been sufficient.

On the other hand, Prof. William Anderson asserts that government policies then exacerbated the pandemic. He writes (all bold highlights mine),

``Most people don’t remember 1918 as the year the flu pandemic began; they remember it as the year that World War I ended. This was the "War to End All Wars," or so it was called, when a more appropriate title might have been the "War to Permanently Expand the State." More than 10 million soldiers died on the battlefields of Europe and millions of civilians died deaths of starvation or were killed in the crossfire.

``Since war is a tool of the state, we safely and honestly can say that the calamities of World War I were state-created. Unfortunately, people did not just die from bullets, artillery shells, bombs, and even starvation. Across the globe, the war resulted in vast swaths of malnourishment as crops were diverted from civilian populations to the huge armies strung across Europe. At the same time, once-productive croplands in Europe were reduced to moonscapes as the armies obliterated the land.

``But governments were not satisfied with the sheer amount of physical and human destruction. Indeed, the government made things worse through lies, and nowhere was that more apparent that the lies told by state agents in order to "prevent panic" from the onrushing flu epidemic. As Wikipedia points out:

"The Great Influenza was the source of much fear in citizens around the world. Further inflaming that fear was the fact that governments and health officials were downplaying the influenza. While the panic from World War I was dwindling, governments attempted to keep morale up by spreading lies and dismissing the influenza. On September 11, 1918, Washington officials reported that the Spanish Influenza had arrived in the city. The following day, roughly thirteen million men across the country lined up to register for the war draft, providing the influenza with an efficient way to spread. However, the influenza had little impact upon institutions and organizations. While medical scientists did rapidly attempt to discover a cure or vaccine, there were virtually no changes in the government or corporations. Additionally, the political and military events were fairly unaffected due to the impartiality of the disease, which affected both sides alike".

``Exacerbating the crisis in this country was the crowding of American troops onto ships following the war’s end, which was guaranteed to spread the sickness and help it spread when the soldiers reached the USA. On the home front, huge war bond rallies in large cities brought people into very close proximity with each other, allowing the flu to spread rapidly. On one end, the government helped to create the conditions that spread the flu; on the other hand, agents representing the state lied about those conditions.

``By the war’s end, Germany was near starvation (and many people did starve to death during the British blockade that lasted well into 1919), and about a half-million civilians succumbed to the sickness in that country. It is estimated that 16 million people in India died of the pandemic.

``Yet, when it raises the prospect of a repeat of this very horror, governments engage in more lies. We forget that life expectancy in the United States was in the mid-50s for white males and less than 50 for black men. In countries elsewhere, and especially in Asia and Africa, life expectancy was much shorter. Medical care at that time was primitive compared to what we have today, even in poor countries, and it was not uncommon in that era for people to be exposed to epidemics that pretty much have disappeared today.

``Even with those odds, the mortality rate during the 1918–1920 pandemic was estimated at between 2.5 and 5 percent. We can be assured today that not only would fewer people become sick, but even fewer people would die. In other words, even at its worst, the current outbreak of Swine Flu, while bad, is not going to turn into a pandemic no matter what CNN and the CDC try to tell us."

In short, the swine flu seems to be more about the politics of government control than of the health hazard itself.

Professor Anderson concludes, ``I doubt seriously that any plan by government can or will lessen the impact of this current "epidemic," if we can call it that. However, I also have no doubt that if emergency plans are kicked into place, it will be much easier for the government to call for further states of emergency, with the threshold becoming lower and lower. That we should fear much more than the Swine Flu."

Swine Flu: The Black Swan That Wasn’t

``There is only one thing which causes man to look for and to organize a tool which is an instrument of compulsion and prohibition. That thing is fear. Men look to government to protect them because they fear. And virtually without exception, everything that human beings fear becomes a project for government." Robert LeFevre The Nature of Man and His Government

The Swine Flu could have been a Black Swan. And perhaps yet it could.

The Black Swan theory as proposed by my favorite iconoclast Nassim Nicholas Taleb comprises three traits:

One, it “lies outside the realm of regular expectations”,

Two, it “carries an extreme impact” and

Finally it makes people “concoct explanations for its occurrence after the fact, making it explainable and predictable”.

Since the swine flu struck, it had practically caught everyone by surprise. Next, many have been unnerved or nations have been in a state of panic; the World Health Organization (WHO), the health agency of the multilateral organization the United Nations, have raised the pandemic alarm level to 5 out of the maximum 6, which implies pandemic levels or the risks of the global spread of disease as “imminent”. (Reuters). Lastly, there have been many theories circulating in traditional media or in the cyberspace as to why and how such ailment came to be.

So this episode contains elements fitting of a Black Swan. But what seems arguable is the degree of impact.

Since the Swine Flu surfaced in the news, markets have initially been devastated, albeit not equally. Realizing the sensitivity of today’s fragile environment, I had also been tempted to undertake “crash” or defensive positions.

However, it dawned upon me that panics are always triggered by our brain’s Amygdala, which had been hardwired into our fight-or-flight responses by our primitive progenitors, who were faced with survivalship against the adverse forces of nature. Panics are actually exacerbated by the lack of information.

Hence, considering the uneven nature of the market’s responses, the underlying market trend, the most recent experiences of the world to deal with epidemics (SARS, Avian Flu) and the rapidly advancing state of our technology, I decided that it would be best to defer fear and possibly deal with this from the reverse.

Figure 1: US Global Investors: SARS Blip

A great example would be the Severe Acute Respiratory Syndrome (SARS) episode, as shown in Figure 1.

From the benefit of hindsight, the SARS was a short term dislocation or a blip or another account of Posttraumatic Stress Disorder (PTSD) for the tourism industries of key East Asian economies. From the market perspective, it served as a window of opportunity to profit from fear.

Since global markets have rallied furiously following the initial shock from the Swine Flu this implies that the pandemic risks have been digested and discounted in contrast to the headlines and the actuations of governments.

Sensationalism-Survivorship Bias: Markets versus Media and Politics

So why the flagrant disparity between the market and news headlines or from political authorities?

Because it is primarily about perspective.

In Mexico, the epicenter of the disease, the present death toll from the Swine flu has been reduced from 176 to 101 (Guardian) and now to 75 (BBC)! But even at 176, this number represents as an infinitesimal fraction relative to Mexico’s population of 110 million (CIA).

Moreover, the expanded global reach is said to cover 18 countries which had reported accounts of infections, as The Independent reported, ``The World Health Organisation said that 18 countries have now reported 766 infections. The confirmed cases include 443 in Mexico, 184 in the US, 85 in Canada, 15 in Spain, 15 in Britain, six in Germany, and smaller numbers in 12 other countries. Italy reported its first known case yesterday, a man in the Tuscany region who returned from Mexico on 24 April. He has since recovered. Almost all infections outside Mexico have been mild. In Britain, where two new cases were confirmed – one being the husband of a woman who was confirmed the day before – some 632 possibles are under investigation”.

The accounted fatalities, as of this writing, have been 17 globally, according to the same article.

To compare, the US Centers for Disease Control and Prevention (CDC) reports of 36,000 influenza associated deaths and 200,000 hospitalizations annually. This translates to 98 deaths per day and 548 people hospitalized per day from seasonal influenza in the US alone.

In addition, 115 people die from car accidents a day in the US (car-accidents.com), 38,500 People die each week around the world from the Aids virus and 1,288 is the number of British people who die from strokes in an average week (The Independent).

In other words, the actual collateral damage has hardly surpassed the average annual losses from its seasonal strain counterpart or from other common causes of deaths even based on US figures alone. Yet because the disease has reached 18 countries with 766 infections and 17 deaths, the WHO has triggered global alarm bells and international hysteria by placing the pandemic alarm level to 5!

So opposite to the survivorship bias, which usually fixates on winners, global authorities today have been entranced with sensationalism and has virtually used fears to respond on an overkill basis.

Notwithstanding, the ensuing consternation has led to divergent definitions of the disease; the Swine Flu has been reported as little to do with the Swine itself (Poor Pig- serves not only as human’s dish but as fall “guy” animal!) where according to the Reuters ``The WHO has said it would call the new virus strain Influenza A (H1N1), not "swine flu," since there is no evidence that pigs have the virus or can transmit it to humans. Pork producers had said consumers were shunning their product.”

Bizarrely too, even some US Farmers have raised concerns that their herd of pigs might be contaminated by infected humans!!!

This paradox as reported by another Reuter’s article, ``There is no evidence of this new strain being in our pig populations in the United States. And our concern very much is we don't want a sick human to come into our barns and transmit this new virus to our pigs," said National Pork Producers chief veterinarian Jennifer Greiner. If humans give it to pigs, we don't have things like Tamiflu for pigs. We don't have antivirals. We have no treatment other than to give them aspirin," said Greiner.” (bold highlight mine).

Yet many have alluded to the Spanish Flu as its origins, but the effects have been so far way way way off.

The Spanish Flu as described by wikipedia.org, ``The pandemic lasted from March 1918 to June 1920, spreading even to the Arctic and remote Pacific islands. It is estimated that anywhere from 25 to 80 million people were killed worldwide, or the approximate equivalent of one third of the population of Europe, more than double the number killed in World War I. This extraordinary toll resulted from the extremely high illness rate of up to 50% and the extreme severity of the symptoms, suspected to be caused by cytokine storms. The pandemic is estimated to have affected up to one billion people: more than half the world's population at the time.”

Perhaps lacking the expected casualty impact in the scale of the Spanish Flu pandemic, authorities have presently been downplaying its association, this from the Associated Press, ``Scientists looking closely at the H1N1 virus itself have found some encouraging news, said Nancy Cox, flu chief at the federal Centers for Disease Control and Prevention. Its genetic makeup doesn't show specific traits that showed up in the 1918 pandemic virus, which killed about 40 million to 50 million people worldwide.

``"However, we know that there is a great deal that we do not understand about the virulence of the 1918 virus or other influenza viruses" that caused serious illnesses, Cox said. "So we are continuing to learn." (all bold emphasis mine)

The irony is, if the said expert does not understand much about the virulence of the 1918 virus, how can she conclude that the genetic make up of today’s strain doesn’t resemble the specific killer traits of 1918 virus? Isn’t this a case of rationalization?

So like in the markets, we seem to be witnessing evidences of reflexivity behavior being applied to the Swine Flu incident-where the present outcome (diminished degree of impact and rising markets) seems to be influencing the public’s thinking as reflected by news accounts and backed by shifting views or sentiments of officials as cited by mainstream media.

Yet the frenzied policy responses have resulted to some unintended consequences. For instance, Egypt’s arbitrary decision to slaughter its entire pig population has spawned a religious schism between majority Muslims and Christians.

Another, Mexico’s decision to shut down stores and companies or its economy has prompted some agitation among the citizenry. According to the Reuters, ``The Labor Ministry said it would fine or forcibly close companies that stay open Monday and Tuesday as a major factory association and many small businesses say they plan to.

``"As far as I know we're coming to work next week. Unless someone comes from the government to tell us to close," said Victor Barracas, a bookstore employee in central Mexico City.”

It appears that the Mexican government prefers its population to suffer or perish out of starvation than from an overblown epidemic!

Talk about governments knowing the interest of their people.

Conspiracy Theories

Nevertheless, the compulsiveness over the Swine Flu won’t be complete without “conspiracy” theories.

Since the current strain of Swine Flu combines genetic material not only from pigs but from birds and humans, where “it has bird flu from North America, swine flu from Europe, and swine flu from Asia. Humans do not have natural immunity to this strain”, (qualityhealth.com) some have suggested that this has been a “human engineered pathogen” meant as a biological weapon for biowarfare.

Many possible scenarios have been floated; it could have been an experiment gone awry or accidentally leaked into the population, or a deliberate covert test by some government entities for political purposes (deflect attention from the economic crisis?), or from a rogue insider who could have stolen from the government’s biolabs in order to advance an unspecified cause, similar to the Anthrax tainted letters mailed to the US Congress from which an employee, Bruce Edwards Irvins, a microbiologist, vaccinologist, and senior biodefense researcher of the US Army Medical Research Institute of Infectious Diseases (USAMRIID) in Fort Detrick, Maryland was held responsible (Global Research).

Or it could also have possibly been perpetrated by vested interests aimed at creating at an atmosphere of pandemic for economic or financial interests, or worst, perhaps in cahoots with the government.

And this isn’t new, according to qualityhealth.com, ``in 2006 investigators discovered that a major pharmaceutical company knowingly dumped HIV-tainted drugs for hemophiliacs onto European, Asian and Latin American markets.”

Anyway, such plot may run across the similar lines as with the movie Mission Impossible II.

Stock Market and Pandemics-Then and Today

True enough a full blown pandemic at the scale of the Spanish Flu will result to economic mayhem.

Economic activities in heavily impacted areas will suffer most while deglobalization in trade, tourism, migration or investments will probably worsen, given today’s recessionary environment.

But we learned that such devastating pandemic don’t necessarily translate to stock market collapses.

Since the public has been obsessed with the Spanish Flu, Bespoke Invest gives a good account of how the US stock market reacted to its outbreak in 1918 see figure 2.

Figure 2: Bespoke Invest: Spanish Flu and Dow Jones Industrials

We quote Bespoke Invest, ``There were three pandemic waves from 1918-1919, with the worst coming from October to December of 1918. While fear of the flu was widespread, the market really didn't react too badly. Following the first pandemic wave, the market sold off a little bit, but then rallied during the summer months before topping out prior to the second wave. The market trended downward during the worst wave of the flu outbreak, but it only went down 10.9% from peak to trough, and then it rallied significantly during and following the third wave. World War I was also coming to an end in late 1918, so the end of the pandemic and the war probably contributed to the subsequent rally in stocks.”

Let me emphasize that despite the huge losses of human lives and massive economic disruption brought about by both World War I and the Spanish Flu, the Dow Jones lost only 11% from the Spanish Flu plague.

However, it won’t do justice to say that the Spanish Flu was the biggest driver of the markets then, as with the culmination of World War I, because there could be other possible unseen variables which may have contributed to the market action, although we also don’t deny that both factors could have provided for significant inputs.

Unfortunately, history, for the mainstream, is always seen from a single observation that had taken place.

But the point is; initial fear from a shock usually dominates the markets, which is then followed by gradual recognition of the problem and its eventual resolution-the recovery.

Today we seem to share a similar impact but at very compressed or short circuited cycle see figure 3.

Figure 3: Stockcharts.com: Swine Flu: Aborted Black Swan

Major global stock market benchmarks as seen by the Dow Jones World (DJW), Emerging Markets (EEM), Europe’s Stoxx 50 (STOX 50) and Asia (DJP1) seems to have simultaneously suffered a “blip” (circle) from the pseudo Swine Flu scare which eventually was more than recovered by most global bourses at the close of the week’s session.

Another way to look at it is that collective governments push to inflation has far larger influence than fear generated from the pandemic menace. Besides, by stoking fear governments implied action is to spur inflation by spending more for protection.

In addition, today’s environment is very much different than that of 1918. The world has been more globalized or integrated. Moreover, technological diffusion has been increasingly deepening this integration whereas monetary standards that drive the risk taking environment have been distinct.

As to how this has altered the pandemic risk environment we suggest some based on news accounts;

-the lessons from SARs and the Avian Flu have fostered stronger collaborations among global governments in dealing with potential pandemic risk by agreeing on “a sensible set of protocols for pandemic preparedness, sharing of genetic samples and other ways of coordinating a global response.” (Economist)

-technology impelled advancement in incubation and manufacturing techniques. Again from the Economist, ``It is possible, though, that new technology will come to the rescue. Gregory Poland of the Mayo Clinic, an American hospital chain, argues that thanks to SARS, bird flu and fears about bioterrorism, work has been undertaken on a range of new incubation and manufacturing techniques.

``One example is DNA-based vaccines, which are made in cell cultures, not incubated slowly in eggs. Vocal, an American biotechnology firm, has shown in early tests that its DNA vaccine for potentially pandemic influenzas, such as strains of H5N1, is safe and effective, and it claims the technology can be scaled up easily.”

-technology enabled information sharing via the cyberspace which has cultivated mass collaboration, networking and openness in the medical and science industry that may lead to faster vaccine discovery and production.

From the Reuters, ``Scientists in Mexico, the United States and New Zealand have since posted full sequences of its DNA taken from 34 virus samples in an online public library. And the list is growing.

``What this means is scientists everywhere can now use these descriptions to create new tools to fight the virus, such as rapid diagnostic test kits and vaccines.

``While the fastest conventional tests take up to two days, scientists are designing highly specific ones that can pick up this swine H1N1 flu virus in four to six hours…

``The genetic sequences have just been made available ... many laboratories are rushing to find the best test, it will take one to two weeks (for us to design one), but we need a lot of validation, we need hundreds of specimen to do that," said microbiologist Yuen Kwok-yung at the University of Hong Kong.”

Conclusion

So while the risks of pandemics will always be present in a rapidly evolving global environment, whether due to natural or lab-induced viral mutations, the world’s capability to address such risks based on global collaboration and technological adoption appears to be more enhanced than the yesteryears. Hence, conditions from the Spanish Flu, the SARS, Avian Flu or the pseudo Swine Flu have been different.

But this doesn’t guarantee immunity from other prospective tail risks.

Nevertheless, the recent Swine Flu which had the elements of surprise and rationalizations from the public almost seemed to have morphed into a full blown Black Swan risk except that the degree of impact was apparently muted in terms of collateral damage or as viewed from the financial market’s response.

The only profound impact from the present episode based on last week’s drama had been government sensationalism and its attendant overreaching political response which had been greatly amplified or inflamed by media.

Fear, as we know it, is a conventional tool of control used by governments to subvert civil liberties by coercion. Thus, considering today’s socialization trends of important segments of the global economy, it can’t be dismissed that this could be another part of the tactical socialization thrust to impose more government on our lives.

Nonetheless, the market reflecting on its inherent discounting mechanism has shattered this prism of state instituted fear and by virtue of reflexivity behavior has equally diminished its justification. The likelihood is that the threats of the pseudo pandemic will evaporate overtime.

Over the interim, global stock markets and the commodity markets will most likely continue to manifest on the concerted inflationary measures adapted by global governments.

Tracking Swine Flu's Global Reach, Understanding Pandemics

The following map from New York Times shows of the areas where the contamination from the Piggy Flu has been accounted for so far.

The epicenter being in Mexico.
The map below reveals of the global reach.


So far only 7 countries have reported cases of the flu's infestation.

According to the New York Times, ``Israel confirmed its first two cases of swine flu, which is now in at least seven countries. Ten others including China and Russia, which were set to quarantine passengers suspected of having the flu, are investigating possible cases."

Despite the global reach, this hasn't been pronounced yet as a full blown pandemic.

Anyway to give you an idea how pandemics work, the map below from Leonardo Monasterio gives a great perspective of the spread of the Bubonic plague otherwise known as the Black Death, one of the deadliest in history.

The reported casualties-75 million people worldwide. Europe suffered most having lost 30-60% of its population.

The difference in the manner of contamination then and today is that the former has been contiguous whereas today has seen a wider dispersion.

Although I don't think we are going to get anywhere near this given the positive response of the flu to present medication. We just hope that this won't mutate into a drug resistant strain.

Besides, the alertness and swift response gained from recent experiences (e.g. SARS and the Bird Flu or Avian influenza) aside from the capability of technology to adopt should make us more prepared to deal with this pestilence.

Cartoon of the Day: Swine Flu or Pork Flu?

Nice one from the Investor's Daily...