If the death rate continues to be this high in China, it will be problematic for the economy.
There's no reliable data about the mortality rate, but at this point the WHO believes it to be relatively mild.
Dividing the number of reported deaths by number of reported cases is NOT a valid way to estimate mortality rate: both numbers suffer from
heavy selection bias, even if we assume the Chinese data is reliable, which we cannot.
What we
do know is that none of the ~60 international verified cases of the coronavirus have died, and several have already healed and were released from hospital. This is far better than SARS or MERS, where almost every infection resulted in a severe case.
Every passing day without international victims makes the Wuhan virus closer to the mortality rate of an unknown influenza strain we have no vaccination for.
Edit:
Here's the WHO's disease modeling expert said about this today:
Coronavirus: 100,000 may already be infected, experts warn (The Guardian)
Prof Neil Ferguson, a public health expert at Imperial College, said his “best guess” was that there were 100,000 affected by the virus
Ferguson, whose team have been modelling the disease for the World Health Organization, said they estimated the virus had a reproductive rate of 2.5-3, meaning that each person infected would potentially transmit it to up to three others.
“My best guess now is perhaps 100,000 cases right now,” he said, although it could be between 30,000 and 200,000. “Almost certainly many tens of thousands of people are infected.”
Most of the cases that have been exported to other countries from China have been mild, he said.
With mild symptoms it's difficult to tell apart from regular flu season symptoms.
Basically what Prof. Ferguson says is that it's likely not possible to stop this strain, but that the current variants are comparatively mild in outcome.
What seems somewhat of a puzzle to me is why China is employing such drastic measures. It would seem that if indeed the disease is comparatively mild, the best policy would be to do nothing and let it run its course ASAP. By imposing quarantines they slow the spreading, but also prolong the outbreak.
Anyway, the impact on GF3 will probably be real - but it's also true that China vehicle sales increased by more than 10% during SARS, due to people desiring to avoid public transportation.
So if the parameters of the Wuhan virus verify (they might not, it might mutate, etc.), the impact on GF3 production might be negative, but the impact on both MIC Model 3 and Fremont S/X/3 demand (Biodefense Mode ...) could be positive.
Macros next week will possibly be negatively impacted, which might affect TSLA through standard correlations.
