COVID DD

If you're not in bear gang, it's not too late to join, and I suggest you do so promptly because shits about to hit the fan frens. That being said, I plan on riding the "V" down and up on this one, and lastly, if you're a perma bull you're in luck I've got some companies at the bottom that I think will go up over the next few months.

What's about to happen:

Let's stick to the facts and correlate this puppy to a similar outbreak; H1N1: "From April 12, 2009 to April 10, 2010, CDC estimated there were 60.8 million cases (range: 43.3-89.3 million), 274,304 hospitalizations (range: 195,086-402,719), and 12,469 deaths (range: 8868-18,306) in the United States due to the (H1N1)pdm09 virus... Additionally, CDC estimated that 151,700-575,400 people worldwide died from (H1N1)pdm09 virus infection during the first year the virus circulated " [1]

Since H1N1 got memory holed and everybody forgot about it, the virus became a modern flu, we have flu shots for this thing and chances are you've probably had it at one point or another -- it's just one of the flues that floats around each season. But the Corona is different...

First off, this thing already has a reproduction rate higher than any of the previous outbreaks in the last 150 years [3]. AND it's one of the most deadly -- however only to certain age groups which is a big difference [4]. Now I do want to make it clear that the Spanish Flu was a lot deadlier to healthy adults, also the age demographics have changed. StatsCanada actually has a good tool that shows the population pyramid and you can compare Spanish Flu in 1918 to 2020 and it'll have some similar-ish results to the USA [5]. There's also population pyramid tool here for the USA but it only goes back to 1950 [6].

Buddy of mine with access to a Bloomberg terminal sent this to me the other day which tracks the spread of the Corona virus [7]. Think the code is 'Map Virus' or something. What matters is that we can see a very obvious trend of exponential growth, in fact that's how you model these things... This thing will spread like wildfire once it starts to hit the cities in America, and... already has. All it takes is one 'chad spreader' to jump on the subway and it'll be a matter of weeks and the entire city is infected. In fact it's already happened in Toronto so buy puts on $CANADA [8].

What matters is that we can see that something like ~60.8 million people who got H1N1 in the USA from 2009 to 2010 and this thing had an r0 of only like ~1.5ish. The bat soup virus currently has an estimated r0 at ~2.4 right now, mind you this is a number that varies through time and can decrease by human intervention (such as quarantines of cities), which will inevitably transpire...

If we assume that this thing spreads with even some level of similarity to H1N1 in 2009, this is going to be a bloodbath for the boomers. First and foremost, this will spread at a much higher rate among boomers and those in old folks homes, we've got evidence of that already [9].

But that's not all. Italy is fucked. They just announced a quarantine of 1/4 of their fucking population [10]. Take wild guess how that's going to fare for their economy. The FTSE MIB is down shy of 20% from it's highs as it stands right now and its only going to get worse [11]. Given that the Italy is basically a leading indicator of what's going to happen in the USA... I fucking DARE YOU to buy spy calls.

So let's get to the nuts and bolts of this. Some autist named Dr. James Lawler stated that worst case scenario this thing could infect 96m in the USA and kill 480,000 people [12]. However, funny enough his estimates are based on a mortality rate of 0.5%. The current mortality rate is ~3.5% so, rather, we could be looking at up to 3,360,000 dying in the USA if the mortality rate is what it currently is.

However, we can math this based on the population pyramids I posted above. In the USA if we take the known mortality rates and population pyramid and transpose that on the worst case scenario, we're looking at shy 1.9m dead (mostly older people) given that 30% get the virus in the next year [13]. If this spreads at the same rate as H1N1, then we're looking at a total of ~60.8 million infected in a year's time. This corresponds to ~18.6% of the population getting it and would result in ~1.16m people dead [14].

Now, I'm willing to bet that my boy Donnie isn't interested in losing a massive chunk of his voting block so I'm betting that we see quarantines very soon in the USA, entire cities shut down just like we've seen in China and just like we've seen in Italy and Iran. It's going to happen and when it does, the lemmings will be shocked. I mean, this shouldn't come as a surprise, there's already runs on toilet paper in Australia over this thing [15].

Anyways, I think we'll get a cure eventually and that everybody reading this will be fine, in fact I'm not a doomer whatsoever. Society will continue on and SPY will eventually recover and I'll join bull gang again, but I'm sure Monday will be a bloodbath after Italy quarantined like 16 million people.

But back to my point, just think about what'll happen to SPY when a US city announces a quarantine. They're already preparing for it by declaring states of emergency now [16]. The fear will be real and it already is...

EDIT: Figured I'd add a bit more on Canada as I don't think it's priced in up there quite yet. Again, I took some numbers from StatsCanada [17] and plugged them in against current known mortality rates and we ended up with this [18]. Estimated 234k dead which... is bad, but that's a flood of dead people in a short amount of time. Also I assume a 30% infection rate but I think this things going to have a much high infection rate because of the fact that we corral all our old into old folks homes... it just takes one sick caretaker and they've all got it and the worst part is that you can have it and spread it without even knowing [19]. So this basically becomes a catch-22. If elderly care takers don't show up to work because they're sick, elderly people die, if they do show up, there's a chance they're giving them COVID-19, it just takes one and they'll all catch it... real morbid stuff. Basically each old folks home is a tranche in a CDO for the few of you retards that know what I'm talking about...

So how do we profiteer from this? And what will inevitably transpire?

EDIT 2: SPX e-minis currently trading at shy of -5%... we're hitting the circuit breakers tomorrow. Fed will drop rates again by end of week.

Conclusion:

I know half of you retards skipped to here but kudos to the champions that read everything I wrote.

1. General stock market decline, puts on $SPY or high beta stocks if IV isn't too high
2. for my perma-bull frens, calls on funeral home and burial companies: $SCI, $CSV, $MATW, $PLC:CA, $DTY:UK, etc. EDIT: (as u/dollarsandcents101 pointed out be careful on funeral homes... could ban funerals if this thing really get's going)
3. Puts on old folks care homes because those are probably going to be vacant here very shortly and thus less cash flows to investors... stocks like: $WELL, $VTR $OHI, EDIT: $CSH.UN:CA (Canadian, option chain is a lot less liquid than USA so... be careful), SIA:CA (another one, already crashing, has options, less liquid though)
4. I'm still bearish airlines and travel... I mean go look at the chart of $AAL. After 9/11 that stock went from $40 a share to literally $2 a share... in 2003. The same thing happened during the GFC, stock again went from over $40 a share to a fucking penny stock -- traded at like $0.30 per share. Get ready for round 3... I look forward to buying calls on airlines after this is all over.
5. bearish any developing country/emerging market ETF's. They're going to get hit hard.
6. I don't know anything about medical or medical research stocks but calls and puts on companies researching corona virus cure. Again... correct me if I'm wrong but to my understanding it's zero-sum, the company that gets a solid cure makes bank and the rest are fucked but again idk this isn't my area whatsoever. Also looks like a lot of these stocks are rocketing and IV is massive so I'm sitting on the sidelines on this one

If you're from r/all wanting to get in on the tendies, I saved a special one just for you! Go all in on $LVS 80C 3/13 calls, trust me. Cannot go tits up.