Empty store shelves coming soon from coronavirus

The coronavirus in China has hit the stock market with a force on Tuesday as Apple and WalMart gave draconian guidance because of the economic shut down of the country.

Apple states it will shutdown its Chinese factories until June, while Walmart cut revenue projections for the next two quarters due to supply chain disruption over the epidemic.

These are just the tip of the economic downturn to hit the markets over the shut down of the world’s second largest economy and the possibility of the virus moving abroad to other southeast Asian countries.

The latest numbers out of China says: 72,436 infected people with 1,868 recorded deaths. While these numbers may be contested by organizations outside the government, it marks to a 2.5 percent mortality rate.

In Beijing China’s President Xi played down the any thoughts of an economic slowdown due to the coronavirus suggesting in a speech that the country will meet its previously released guidance.

The premise behind this forecast projects the infection rate of the virus will be slowed as warmer weather hits China in April. While that may be a broad generalization of previous outbreaks, leaks coming out of China suggest that this is far more virulent than other contagions including the SARs virus.

One other aspect of the virus. The final Chinese shipping containers that left port before the news of the outbreak broke are about to hit US ports.

If you look at the Baltic Dry Index, which measures shipping activity for dry goods — meaning oil is not in the index — it is down 60 percent in 2020.

This is why I warned earlier that empty shelves could be coming to a big box store near you as well as an Apple iPhone or tablet. Not the news the White House wants to see in an election year.


3 thoughts on “Empty store shelves coming soon from coronavirus

  1. It will be interesting to see to what degree distribution channels actually are cleared and if another tsunami of goods quickly follows. There is a set of facts, an emerging reality, and a great deal of great power politics and anti-China agitation compounded here.


  2. Pingback: Wall St.’s virus is short selling | Gray's Economy

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