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| The World Isn’t Ready for a Major Coronavirus Outbreak | The World Isn’t Ready for a Major Coronavirus Outbreak |
| (8 days later) | |
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| The World Health Organization said yesterday that coronavirus cases outside China were accelerating. Around 80,000 people in nearly 40 countries have been infected, and at least 2,600 have died. | The World Health Organization said yesterday that coronavirus cases outside China were accelerating. Around 80,000 people in nearly 40 countries have been infected, and at least 2,600 have died. |
| Draconian measures in China have slowed the spread there, the W.H.O. noted, but the outbreak could prove hard to contain elsewhere. Most health experts are worried about Iran, Italy and South Korea. Japanese officials said today that the country, which has more than 800 confirmed cases, was at a “crossroads” in fighting the outbreak. | Draconian measures in China have slowed the spread there, the W.H.O. noted, but the outbreak could prove hard to contain elsewhere. Most health experts are worried about Iran, Italy and South Korea. Japanese officials said today that the country, which has more than 800 confirmed cases, was at a “crossroads” in fighting the outbreak. |
| If other countries followed China’s “bold approach,” as the W.H.O. put it, widespread quarantines and other restrictions would hit the global economy hard. This fear was partially responsible for yesterday’s tumultuous markets, as investors hedged their portfolios, businesses revised their forecasts, and officials prepared for the worst. | If other countries followed China’s “bold approach,” as the W.H.O. put it, widespread quarantines and other restrictions would hit the global economy hard. This fear was partially responsible for yesterday’s tumultuous markets, as investors hedged their portfolios, businesses revised their forecasts, and officials prepared for the worst. |
| Behind the scenes: The coronavirus live briefing on the NYT website has been running for 34 days and has been viewed more than 50 million times, half of those from readers outside the U.S. | Behind the scenes: The coronavirus live briefing on the NYT website has been running for 34 days and has been viewed more than 50 million times, half of those from readers outside the U.S. |
| Global stocks fell sharply yesterday, with the S&P 500 suffering its worst single decline in two years. In just one day, the benchmark index gave up all its gains for the year. Every major sector fell. | Global stocks fell sharply yesterday, with the S&P 500 suffering its worst single decline in two years. In just one day, the benchmark index gave up all its gains for the year. Every major sector fell. |
| Until now, investors viewed the virus outbreak “like a minor traffic jam,” according to the economist Megan Greene: “Disruptive but, in economic and financial terms, something you get past quickly.” Indeed, a recent survey of fund managers by Bank of America found that those investors were holding their lowest cash balances since 2013. | Until now, investors viewed the virus outbreak “like a minor traffic jam,” according to the economist Megan Greene: “Disruptive but, in economic and financial terms, something you get past quickly.” Indeed, a recent survey of fund managers by Bank of America found that those investors were holding their lowest cash balances since 2013. |
| No longer. Stock investors are starting to price in the risk of a potential pandemic. Bond investors have been worried for some time, pushing long-term yields to historic lows. | No longer. Stock investors are starting to price in the risk of a potential pandemic. Bond investors have been worried for some time, pushing long-term yields to historic lows. |
| Bucking the trend, the usual havens like U.S. Treasuries, the dollar and gold performed well. And if you’re brave enough to trade things linked to the VIX volatility index, the sharp, sudden lurch in trading has been a winner. | Bucking the trend, the usual havens like U.S. Treasuries, the dollar and gold performed well. And if you’re brave enough to trade things linked to the VIX volatility index, the sharp, sudden lurch in trading has been a winner. |
| Why are investors reacting now? Our colleague Matt Phillips shares his thoughts: | Why are investors reacting now? Our colleague Matt Phillips shares his thoughts: |
| The coronavirus isn’t just a China story anymore. Expanding outbreaks in other countries have investors and analysts rethinking their knee-jerk calls that the economic impact of the virus would be transitory and largely limited to China and its Asian neighbors. | The coronavirus isn’t just a China story anymore. Expanding outbreaks in other countries have investors and analysts rethinking their knee-jerk calls that the economic impact of the virus would be transitory and largely limited to China and its Asian neighbors. |
| So far, economists have only snipped their expectations for the economic impact on the United States and the profits of American companies. But the sharp tumble in stocks — and more importantly bond yields — on Monday suggests investors are quickly moving beyond those relatively rosy views. | So far, economists have only snipped their expectations for the economic impact on the United States and the profits of American companies. But the sharp tumble in stocks — and more importantly bond yields — on Monday suggests investors are quickly moving beyond those relatively rosy views. |
| Of course, investors can be wrong. Markets often overshoot, ping-ponging between overly optimistic when times are good to downright despondent on the first sign that they might, well, not be. The truth is almost always somewhere in the murky middle, except when it isn’t. | Of course, investors can be wrong. Markets often overshoot, ping-ponging between overly optimistic when times are good to downright despondent on the first sign that they might, well, not be. The truth is almost always somewhere in the murky middle, except when it isn’t. |
| U.S. stocks are set to open up slightly today, although European shares also started in the green before slipping into the red. Traders say they aren’t in “sell everything” mode — even if what passes for optimism these days are calls like those from Blackstone’s Byron Wien, who recently said, “I don’t think it’s the end of the world.” | U.S. stocks are set to open up slightly today, although European shares also started in the green before slipping into the red. Traders say they aren’t in “sell everything” mode — even if what passes for optimism these days are calls like those from Blackstone’s Byron Wien, who recently said, “I don’t think it’s the end of the world.” |
| Profit warnings from companies are piling up, as the outbreak’s impact on supply chains and consumer spending takes its toll. | Profit warnings from companies are piling up, as the outbreak’s impact on supply chains and consumer spending takes its toll. |
| United Airlines abandoned its earnings guidance for 2020, saying “the range of possible scenarios is too wide” to provide a sensible forecast. With some understatement, it said demand for flights to China was down “approximately 100 percent.” | United Airlines abandoned its earnings guidance for 2020, saying “the range of possible scenarios is too wide” to provide a sensible forecast. With some understatement, it said demand for flights to China was down “approximately 100 percent.” |
| Expectations for a Fed rate cut (or two) are rising, although central bank officials are reluctant to factor epidemiology into their forecasts for the U.S. economy. For their part, Goldman Sachs economists cut their estimate of first-quarter G.D.P. growth to just above 1 percent, saying the risks are “clearly skewed to the downside.” | Expectations for a Fed rate cut (or two) are rising, although central bank officials are reluctant to factor epidemiology into their forecasts for the U.S. economy. For their part, Goldman Sachs economists cut their estimate of first-quarter G.D.P. growth to just above 1 percent, saying the risks are “clearly skewed to the downside.” |
| Falling markets and weaker growth could be a threat to President Trump’s re-election chances, a source of consternation inside the White House. The president tweeted yesterday that the virus was under control in the U.S., and the drop in stocks meant the market was “starting to look very good to me!” The White House’s top economic adviser, Larry Kudlow, added that investors should “seriously consider buying these dips.” | Falling markets and weaker growth could be a threat to President Trump’s re-election chances, a source of consternation inside the White House. The president tweeted yesterday that the virus was under control in the U.S., and the drop in stocks meant the market was “starting to look very good to me!” The White House’s top economic adviser, Larry Kudlow, added that investors should “seriously consider buying these dips.” |
| A Manhattan jury convicted Harvey Weinstein yesterday of two counts of two felony sex crimes but acquitted him of charges of being a sexual predator. No matter: It was a big moment in holding powerful men accountable in a court of law. | A Manhattan jury convicted Harvey Weinstein yesterday of two counts of two felony sex crimes but acquitted him of charges of being a sexual predator. No matter: It was a big moment in holding powerful men accountable in a court of law. |
| A reminder of how the case reshaped the corporate world, according to Rebecca Greenfield of Bloomberg: | A reminder of how the case reshaped the corporate world, according to Rebecca Greenfield of Bloomberg: |
| As sex-harassment complaints spiked in the last two years and numerous prominent people were fired, companies also found new ways to protect themselves. Some merger agreements now include a “Weinstein Clause” in case misconduct emerges. Companies can even purchase a type of “disgrace insurance” against wayward executives. | As sex-harassment complaints spiked in the last two years and numerous prominent people were fired, companies also found new ways to protect themselves. Some merger agreements now include a “Weinstein Clause” in case misconduct emerges. Companies can even purchase a type of “disgrace insurance” against wayward executives. |
| The main selling point of private equity is that, despite hefty fees, it outperforms the stock market. Bain & Company’s latest report on the industry challenges this pitch. | The main selling point of private equity is that, despite hefty fees, it outperforms the stock market. Bain & Company’s latest report on the industry challenges this pitch. |
| U.S. buyout funds’ returns have essentially matched U.S. stock markets over the past 10 years. Returns over longer periods have been better for private equity, but investors may rightfully ask: What have you done for me lately? “Parity with public markets is not what PE investors are paying for,” Bain writes. (In light of these findings, the big annual industry confab that starts today in Berlin, known as SuperReturn, might not live up to its branding.) | U.S. buyout funds’ returns have essentially matched U.S. stock markets over the past 10 years. Returns over longer periods have been better for private equity, but investors may rightfully ask: What have you done for me lately? “Parity with public markets is not what PE investors are paying for,” Bain writes. (In light of these findings, the big annual industry confab that starts today in Berlin, known as SuperReturn, might not live up to its branding.) |
| The future isn’t looking much brighter. “If you draw a trend line between the 10-year return in 1999 and the 10-year return today, it would show a decline of 6 percentage points over that period,” the study’s authors add. | The future isn’t looking much brighter. “If you draw a trend line between the 10-year return in 1999 and the 10-year return today, it would show a decline of 6 percentage points over that period,” the study’s authors add. |
| • The sheer amount of uninvested capital — some $1.5 trillion in so-called dry powder — is driving up prices for deals, eroding funds’ performance. | • The sheer amount of uninvested capital — some $1.5 trillion in so-called dry powder — is driving up prices for deals, eroding funds’ performance. |
| • The only sure winners, the report predicts, are sector experts — think Silver Lake for tech or L Catterton for consumer — or mega-firms like Blackstone and KKR. | • The only sure winners, the report predicts, are sector experts — think Silver Lake for tech or L Catterton for consumer — or mega-firms like Blackstone and KKR. |
| On CNBC yesterday, Warren Buffett told Andrew he would “have no trouble voting for Mike Bloomberg,” though he cautioned that support from a fellow billionaire might not help Mr. Bloomberg win the Democratic presidential nomination. | On CNBC yesterday, Warren Buffett told Andrew he would “have no trouble voting for Mike Bloomberg,” though he cautioned that support from a fellow billionaire might not help Mr. Bloomberg win the Democratic presidential nomination. |
| On buying Bloomberg’s company if the eponymous founder became president, Mr. Buffett — whose Berkshire Hathaway is sitting on $128 billion in cash and loves cash-rich companies with fat profit margins — didn’t mince words: | On buying Bloomberg’s company if the eponymous founder became president, Mr. Buffett — whose Berkshire Hathaway is sitting on $128 billion in cash and loves cash-rich companies with fat profit margins — didn’t mince words: |
| CNBC’s Becky Quick: If Michael Bloomberg becomes the Democratic candidate, would you consider buying his company? | CNBC’s Becky Quick: If Michael Bloomberg becomes the Democratic candidate, would you consider buying his company? |
| Mr. Buffett: No. (Laughs.) I can give you a categorical answer to that. | Mr. Buffett: No. (Laughs.) I can give you a categorical answer to that. |
| Ms. Quick: Because of the price, because of …? | Ms. Quick: Because of the price, because of …? |
| Mr. Buffett: There’d be somebody who’d pay more. | Mr. Buffett: There’d be somebody who’d pay more. |
| We threw out some names of potential Bloomberg buyers, including Mr. Buffett, in the newsletter last week ... but that was before Mr. Bloomberg’s debate debut. | We threw out some names of potential Bloomberg buyers, including Mr. Buffett, in the newsletter last week ... but that was before Mr. Bloomberg’s debate debut. |
| Updated June 30, 2020 | |
| Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days. | |
| Scientists around the country have tried to identify everyday materials that do a good job of filtering microscopic particles. In recent tests, HEPA furnace filters scored high, as did vacuum cleaner bags, fabric similar to flannel pajamas and those of 600-count pillowcases. Other materials tested included layered coffee filters and scarves and bandannas. These scored lower, but still captured a small percentage of particles. | Scientists around the country have tried to identify everyday materials that do a good job of filtering microscopic particles. In recent tests, HEPA furnace filters scored high, as did vacuum cleaner bags, fabric similar to flannel pajamas and those of 600-count pillowcases. Other materials tested included layered coffee filters and scarves and bandannas. These scored lower, but still captured a small percentage of particles. |
| A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico. | A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico. |
| The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth. | The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth. |
| The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave. | The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave. |
| So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement. | So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement. |
| Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks. | Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks. |
| A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study. | A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study. |
| The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April. | The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April. |
| If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.) | If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.) |
| If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others. | If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others. |
| Fun fact: Mr. Buffett has finally traded in his flip phone for an iPhone, a sign of brand allegiance (in addition, of course, to his company’s $74 billion stake in Apple). | Fun fact: Mr. Buffett has finally traded in his flip phone for an iPhone, a sign of brand allegiance (in addition, of course, to his company’s $74 billion stake in Apple). |
| Deals | Deals |
| • HP plans to counter Xerox’s hostile takeover bid with a plan to buy back $15 billion worth of stock. (WSJ) | • HP plans to counter Xerox’s hostile takeover bid with a plan to buy back $15 billion worth of stock. (WSJ) |
| • Revolut, the popular British fintech start-up, has raised $500 million at a $5.5 billion valuation. (Quartz) | • Revolut, the popular British fintech start-up, has raised $500 million at a $5.5 billion valuation. (Quartz) |
| • SoftBank’s second Vision Fund has reportedly invested $100 million in Behavox, a compliance software start-up. (Bloomberg) | • SoftBank’s second Vision Fund has reportedly invested $100 million in Behavox, a compliance software start-up. (Bloomberg) |
| Politics and policy | Politics and policy |
| • President Trump received a huge welcome in India. But that won’t get him any closer to a trade deal with New Delhi. (NYT) | • President Trump received a huge welcome in India. But that won’t get him any closer to a trade deal with New Delhi. (NYT) |
| • Senator Bernie Sanders outlined how he would pay for policy proposals like “Medicare for all.” Not everything adds up. (NYT) | • Senator Bernie Sanders outlined how he would pay for policy proposals like “Medicare for all.” Not everything adds up. (NYT) |
| • Britain’s post-Brexit dilemma: come up with its own rules without alienating its most important trading partner, the E.U. (NYT) | • Britain’s post-Brexit dilemma: come up with its own rules without alienating its most important trading partner, the E.U. (NYT) |
| Tech | Tech |
| • A Cisco employee made nearly $100,000 trading on insider information about a pending takeover. Then he turned himself in to the S.E.C. (Bloomberg) | • A Cisco employee made nearly $100,000 trading on insider information about a pending takeover. Then he turned himself in to the S.E.C. (Bloomberg) |
| • The European Commission has told its staff to begin using the encrypted messaging platform Signal for all communications. (Politico) | • The European Commission has told its staff to begin using the encrypted messaging platform Signal for all communications. (Politico) |
| • Netflix cracked open its viewership black box, with a new feature that will show users the top 10 movies and TV shows in their country. (Yahoo) | • Netflix cracked open its viewership black box, with a new feature that will show users the top 10 movies and TV shows in their country. (Yahoo) |
| Best of the rest | Best of the rest |
| • The start-up reckoning is underway, as investor anxiety and cold financial reality settle in. (NYT) | • The start-up reckoning is underway, as investor anxiety and cold financial reality settle in. (NYT) |
| • A harsh review by a former central bank chief of Thomas Piketty’s new book: “Look skeptically at its solutions.” (FT) | • A harsh review by a former central bank chief of Thomas Piketty’s new book: “Look skeptically at its solutions.” (FT) |
| • A touching obituary for Katherine Johnson, the NASA mathematician who helped make Apollo 11 possible: “They asked Katherine Johnson for the moon, and she gave it to them.” (NYT) | • A touching obituary for Katherine Johnson, the NASA mathematician who helped make Apollo 11 possible: “They asked Katherine Johnson for the moon, and she gave it to them.” (NYT) |
| We’d love your feedback. Please email thoughts and suggestions to business@nytimes.com. | We’d love your feedback. Please email thoughts and suggestions to business@nytimes.com. |