Pandemic Implications | Zero Hedge.
The recent spread of Ebola has led to a tragic loss of human lives and stands to devastate West African economies. As the situation has evolved, and despite the equity market’s apparent belief that it’s all over, Goldman has examined the global economic and market implications of the outbreak.
It would appear Ebola is a thing of the past…
But implications remain as Goldman Sachs explains,
We survey our economists and equity analysts to provide a sector-by-sector breakdown of the disease’s impacts to date and, drawing on past episodes of pandemic threats, its potential effects. We find that the economic costs of pandemics can be severe, but that the hit to growth is usually mostly limited to the region where the disease is centered.
The economic outcomes of a pandemic are often largely determined by an outbreak’s secondary effects, such as the “fear factor” and policy responses. History suggests that most impacts on stocks are typically short-lived and driven more by sentiment than by tangible effects on business activity, although this may not be the case in the mining sector.
Still, Ebola is not expected to alter the global demand and supply balance in most exposed commodities, with the possible – but still unlikely – exception of cocoa.
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