In Hazlitt’s book, ‘Economics In One Lesson’, which I highly recommend to you, he says “…The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.”
You could replace economics with preparedness, and event for policy, and have yourself a handy little rubric for wargaming future preparations.
One thing that I’ve always found terribly irritating about many survivalists is the tunnel vision, or, perhaps more accurately, lack of situational awareness in regard to a particular disaster or event. This current situation of coronavirus is a perfect example of what I mean.
This Kung Flu checks off the ‘pandemic’ tickybox on our checklist of “things we prepare against”. Admittedly, it was right down there with ‘nuclear war’ and ‘comet strike’ in terms of probability on many people’s lists. After all, the last time something like this happened was around a hundred years ago…so it really wasn’t on too many peoples radar. We leaned more towards hurricanes, riots, economic collapses, and that sort of thing.
The thing is, while people may have planned for, or anticipated, a pandemic and made some plans to protect themselves, I would wager that a large percentage of them didn’t think through what else a pandemic brings that you need to prepare against.
An example: When Hurricane Sandy hit New York many people lost their vehicles because of the flooding. Most had insurance that covered the loss, so they sat back and figured they were set. Their inner dialogue went something like this:
“Flooding will occur. I’ll probably lose my car. Let me make sure my insurance will cover it. It does? Great, I’m all set.”
And virtually no one had this inner dialogue:
“Flooding will occur. I’ll probably lose my car. Let me make sure my insurance will cover it. It does? Great. But since I won’t have a car I’ll need to make arrangements for a rental. And fuel. And directions to other supermarkets if my main one is flooded out.” etc, etc.
And this is exactly what happened. People lost their cars but when their insurance said “hey, we’ll cover a rental car for you” those same people found that every rental car for fifty miles in every direction was already rented by people who thought ahead. See, they got so focused on the event (losing their car) that they didn’t think about the consequences of the event (no car rentals being available).
It seems a lot of people worry about the event and put little focus into the effects of the event. The Kung Flu is like that. Everyone stocked up on hand sanitizer and toilet paper, but how many made plans for when the kids school is closed, the paycheck is stalled because you’ve been told not to come into work, the guy who was gonna fix your car is out with the Kung Flu, your AirBNB rental income slumped as tourists stay home, your wife’s housecleaning ‘side gig’ drops to zero as people don’t want strangers in their house, etc, etc. And meanwhile, your mortgage, taxes, utilities, and credit card bills are all still due.
You drop a rock in a pond and ripples radiate out, right? That’s a fair metaphor, I think. The disaster occurs and we focus on that point where the rock hits the water and we don’t think about the ripples that emanate outwards. RIght now one of the biggest ripples is the amazing contortions the stock market is going through. I’d wager that no one, when planning a few years ago for Capt. Tripps, had the foresight to think “Y’know, when that superflu comes through and starts doing its thing, the markets are going to tank…I should probably be ready for that.”
There’s that old expression about not seeing the forest because all the trees are in the way. The forest is the larger, greater, overall chaos and disorder that results from a particular event. We tend to get so fixated on the individual events (trees) that we don’t see the entirety of what chaos theyve created (forest).
Hurricane Katrina, fifteen years ago, was a benchmark for disaster preparation. I have absolutely zero doubt that the Kung Flu of 2020 will be remembered as a black swan event that changed disaster planning for many organizations, governments, and individuals.
The lesson to be learned seems pretty straightforward – when you prepare for a particular event, you need to look at all the possible negative effects that event could cause and you have to be ready for them as well. You have to look as far ‘downstream’ from the disaster as possible and try to see what the consequences will be and how you can best prepare for them.
Did I get caught napping? Honestly, yes. I should have had more money sitting in my brokerage accounts to take advantage of stocks and funds being on sale at 25% off. That’s it. That’s all I’d change. I have enough cash in the bank, and no liabilities, to cover me for a few months if I’m unable to bring in income. No mortgage to sweat, no credit card payments to stress over, no car loan to dread, no student loan to fear. To some degree, I’m insulated from the fallout from coronavirus even if I’m not immune to the coronavirus itself.
So, assuming we all survive this, we should analyze the whole thing, start to finish, and see what lessons we learn from it.
Some great thoughts in there. One thing I *never* thought we would see is developed nations attempting the quarantine major metropolitan cities, let alone entire regions.
Personally, it appears self-evident this is a fool’s errand. Declare a quarantine, and everyone with 2 feet heads for the exits faster than you can say “martial law”. I’m not particularly worried about the virus itself. All any of us can realistically do, is stockpile food and quarantine ourselves from the outside world for a couple months. Beyond that, it gets very complicated.
Implications from the communal fear are far worse than the disease. Bad things happen when all commerce ceases – even for a short time.
Agree with the above. So many are living paycheck to paycheck, the loss of one month’s wages will cause a ripple effect down the line.
Families with kids going to college also face some hard decisions. With some of those campuses proposing to close down, where do the kids who live on campus live ? Do they walk away from this semester, all expenses already paid ? Or do they find a nearby apartment to finish out ?
God willing, this could be the death knell for conventional universities. Those grifters have it coming, good & hard.
I think Corona will be remembered in the same breath as the Bird Flu.
In my circles, that means its just another reason to ridicule the msm.
My argument on this point with my three “bullet proof” sons is that you may be right, but the fallout is real and is affecting you. Even if COVID19 is just the flu, millions of people believe otherwise and their actions will affect you even if the virus doesn’t. The stock market is down. The virus may trigger a recession as people curtail their activity out of fear or a decline in their wealth because of the market sell off. People are fist fighting for ass wipe. You cannot buy hand sanitizer unless you are in the store when they stock the shelves. Probable that you will be able to refinance your mortgage at lower interest rates. Possible that Trump loses reelection and the course of our liberties is changed by a Democratic President. All of this and more is or could happen while the virus never affects you or your family in any discernible way even though you become infected.
I think this is the point of Zero’s thoughts
My point is that this ‘event’ (beyond the folks that are actually catching it) is a construct of the msm. Probably in an effort to gain viewership. I made (and still make since everyone including the most verbose has an opinion) no comment regarding CZ’s mindset or any other effect.
Understood. Think that it is more than MSM though. In fact, from my perspective, acknowledgement of the virus was lacking until recently. I work in commodity trading and we have been watching this unfold since late Jan. Appreciate your perspective. Keeping an open mind so we can evaluate keeps us all ahead.
Your points are well taken. The wider reaction to pandemic has been surprising, and if I find myself pretty isolated from the main effects it’s more due to dumb luck and laziness than any planning. Still, I am amazed at the prevalent reaction. Bottled water gone from the shelves? What part of coronavirus will render the public water supply gone? And if it’s contaminated with the virus, why wouldn’t a few minutes of boiling it suffice?
The greater ongoing disaster is one I truly did not prepare for, nor do I know how to do so. The population of my nation has devolved into legions of idiots. Large groups of people who think socialist goverment actually solves problems, significant portions of the population who aren’t sure what sex they are, pandemics caused by racism, and on and on. Maybe Billy Beck saw it decades ago: the endarkenment is upon us. How should I have prepared for that?
“I need MORE: ammo, food, toilet paper, camo clothing, propane……” ad infinitum.
It’s useful to perform a SWOT analysis – Strengths, Weaknesses, Opportunities, Threats – and periodically review it, quarterly seems about right. It provides a chance to do the “10,000 foot view” on things because it’s easy to sacrifice balance through intensity. We do tend to focus on the new, shiny stuff and it’s real work to resist that and develop a solid, broad-spectrum plan.
Pro Tip: a good SWOT analysis won’t be completed in 20 minutes while Mom’s doing the dishes, Dad’s half-watching sportsball and the kids are demanding attention. It’s not a simple task, and the quarterly reviews aren’t casual either. .
Didn’t think a mini pandemic would affect the market this bad. I knew a correction was over due and expressed concern to my broker late last year. I wanted to park my chunk o’money in cash until afterwards but of course he said ‘don’t worry, it’ll work itself out’.
Lesson learned: Listen to your gut and tell people what you want, don’t ask them what to do.
Now, at 62 and getting ready to retire, I just watched all my 401k gains over the last 10 years disappear. I need to go shooting to make myself feel better.
I look a little deeper than Super Flu, with a follow up Economic Contagion. I see it as a US bio-weapon attack on China, and a Chinese economic retaliation. They will keep the factories closed until Wall Street is a smoking ruin. Don’t forget, last September we started having a liquidity crisis. Beer Flu is just the pin popping the Everything Bubble, which was in trouble ( my guess is another derivatives implosion ). Your paranoid level mat vary. But if it was me, I’d be completely out of digital wealth.
The virus may or may not be a big deal, but, the economic impact will be huge.
Commander Zero, I agree with much of what you are saying. I ran into some severe debt issues about 20yrs ago and worked hard to get out of it. I have been debt free for that last 12 yrs or so and put lots away for a rainy day. My friends who are of like mind agreed with keeping a months work of expenses in cash in a home safe and other prepping steps. One thing I thing might be looking a head to is keeping change rolled and small bills, for those situations where the power is down and stores are operating from a cash box. For those who have cash to spend, small bills and change will be in short supply very quickly and prices will go up accordingly. While this is only a small part of the big picture (the forest) it could prove critical to short term survival when things are grid down. TTFN
we ran into an issue on a motorcycle trip once, a backhoe dug up the communication line to the store/gas station. They couldn’t even take cash because the fuel pumps wouldn’t work unless they were hooked up to Skynet. 80 miles to the next station and we barely made it, mostly by shutting the motor off and coasting down hills in neutral. New vehicles probably won’t even be able to do that.
This is one of your better posts, Commander. It could all be summed up under the heading of physical threat/risk analysis.
https://wbdg.org/resources/threat-vulnerability-assessments-and-risk-analysis