Bloomberg just saved me a thousand words and a lot of fiddling around on Yahoo Finance. This simple headline does the trick: “It Took Four Months and 40% in S&P Before 2008 Stimulus Worked”.
And so, consider me sceptical about the market’s stimulus-based turnaround. As impressive as the rally may be.
In fact, I’m expecting outright financial martial law instead of a recovery.
Of course, 2008’s stimulus wasn’t during a pandemic. And it didn’t feature infinite amounts of money printing. Nor some of the policies which governments have imposed – mortgage suspensions and travel bans.
Still, I can’t find any comparisons which suggest the worst is over yet for the stockmarket. But today, we turn away from stocks and focus on reality.
We have many editors at Southbank Investment Research but, as far as I know, only one is right on the frontlines of the fight against Covid-19.
By that I mean, as well as dispensing investment advice, this editor has spent the last couple of weeks or so dispensing medical advice, treatments and equipment to increasingly worried patients from a retail pharmacy near Paris.
Rather than just writing about it, he’s actually experiencing the battle against the coronavirus played out at first-hand. Putting his own health at risk.
That editor is Gerard Pontonnier.
For those who don’t know, Gerard is the editor of New Drug Speculator, our service that targets breakthrough pharmaceutical stocks.
Gerard, who has around 35 years in the industry, has already been giving his readers his take on coronavirus and the stocks he thinks could do well out of the great Covid-19 vaccine hunt. That advice is for the eyes of his loyal army of readers only.
However, I asked his publisher, James Allen, whether I can send you his latest update as it contains matters of perhaps even greater value. Given the subject matter, James obliged.
On that note, I’ll pass you over to him.
Editor, Southbank Investment Research
I have an important message from the frontlines of the Covid-19 fight
By Gerard Pontonnier (originally published 24 March 2020)
For once, I don’t want to write about clinical trials results, gene therapy (or whatever else) or the financials of any particular New Drug Speculator recommendation. I wish to discuss matters of much greater import.
Only two weeks ago, in my previous note about the coronavirus epidemic, I mentioned that over 113,000 people had been infected by Covid-19 globally and more than 4,000 had died. The pandemic, at that point, had spread to around 115 countries all over the world.
At the time of writing, there are now 375,498 confirmed cases of Covid-19, with 16,362 deaths spread across 195 countries, according to World Health Organisation figures.
The Covid-19 pandemic is spreading faster around the world than most of us could have imagined. In Europe, we are now facing a healthcare emergency crisis with an explosion of infected cases: 63,927 in Italy, 33,089 in Spain, 29,212 in Germany and 19,615 in France. There are over 6,000 cases and counting in the UK.
Covid-19 pandemic situation
Unfortunately, the medical facts are much darker now.
Despite the usual stupid comments and blind vision coming from Donald Trump, the virus has also skyrocketed in the US over the last few last days, with now more than 42,000 cases of coronavirus. Unfortunately, I think this is just the starting wave of this viral tsunami for 330 million Americans.
Let’s get the punchline out of the way right now: this is a war against an invisible enemy, and we need collectively to fight Covid-19!
As a healthcare professional – I’m a pharmacist, remember – I am particularly affected by what I watch on TV channels. I’m outraged by the failures of governments to anticipate and efficiently manage this Covid-19 pandemic crisis.
Physicians, nurses, interns, nursing home professionals, pharmacists, paramedics and others are being put in grave danger as we face massive protective device shortages for masks, gloves, safety glasses, aprons and protective suits.
Intensive-care units are now saturated with the flow of Covid-19 patients, and vital ventilators are in short supply. We are paying the highest possible price for our crazy economic politics that sees us importing everything from China.
Living in France, I am outraged by some of my fellow citizens who seemingly have no concern about Covid-19 or any courtesy towards the elderly population, medical professionals and security forces.
I’m seeing the Covid-19 fight first-hand
Since last week, I’ve been assisting a pharmacist colleague in a retail pharmacy near Paris that’s seen the number of incoming patients surge. I’m seeing, in real time, how this pandemic is dramatically evolving.
It’s certainly hard to reassure stressed patients, provide treatments and healthcare advice amid a backdrop of ever more drug and device shortages. For example, we only had one FFP2 respirator mask available for one week. But this mask must be changed every 3-4 hours to stay efficient against the Covid-19 virus.
Although the French Solidarity and Health Ministry last week confirmed a shipment of 30 million masks to medical personnel throughout France, it said that would be only enough masks for three days. We are still waiting to get one!
A coronavirus outbreak could last for a long time in our respective communities, depending on collective efforts. Around the world, governments and public health authorities are recommending drastic actions to help keep people healthy, reduce exposures to Covid-19 for the most vulnerable people and slow the spread of the disease.
Be clear: we can all do our bit to help the healthcare professionals and emergency and intensive care units to do their daily jobs most securely to save the maximum number of lives.
So, please strictly follow your local public health officials and containment measures. If required, stay at home with your family, stop your social contacts and create a household plan to help protect your health and the health of those you care about during the coming weeks of this Covid-19 outbreak.
Source: Department of Health and Social Care, NHS, UK GOV, Twitter account
Governments and health officials are trying to reassure their populations with simple messages: follow instructions, don’t panic and overreact over all the fake news.
If I can give you now a message of hope, it is that the whole pharma and biotech industry, jointly with private and public research units, are doing their best to collaborate around the world to develop vaccines, supportive therapies and rapid tests to cure Covid-19 infection.
Be aware that more than the majority of infected people have only seasonal flu symptoms without any vital complications. So, despite the rising number of cases, most who become infected suffer only mild symptoms and recover fast.
Good news is coming from China, which is seeing no new domestic Covid-19 cases registered for the last few days, showing that discipline of radical containment and disinfection measures was the best sanitary choice to avoid a massive spreading of the Covid-19 infection in this country.
European countries facing pandemic disaster have to learn from this hugely populated nation in how to react and mobilise people quickly and effectively.
As a New Drug Speculator, you certainly want to know how to react to stockmarkets to manage our portfolio from this coronavirus impact.
As I’ve discussed in previous notes, as long-term investors you’ll know it takes time for drug-makers to build a strong drugs portfolio. To develop a new drug and create value, it takes around 12 years, so you will see that time erases all erratic moves on stockmarkets.
Don’t panic even if the strong performance of our New Drug Speculator portfolio has declined in the last few weeks. Let your long-term investments be, and avoid overreacting on volatility.
My role as the New Drug Speculator editor is to advise you for mid- to long-term investments in promising drugmakers. It’s not at all for day-trading opportunities.
So my advice as the best action to do right now is:
1) Stay at home and take care of yourself and your family
2) Avoid speculating with daily trades on “Covid-19” stocks
3) Do nothing with your long-term New Drug Speculator portfolio.
Again, what we are experiencing now is a temporary pandemic event for the forthcoming weeks and, likely, months. The economy will undeniably suffer from Covid-19 with possibly a recession on the horizon, but we’ll come through it even more robust. For me, as a pharmacist, it’s certainly time to rethink and rebuild local economic models.
But remember, whatever your job, you must be an active player to stop the spread of Covid-19!
Editor, Southbank Investment Research
Category: Genetics and Biotechnology