Good morning, Quartz readers!
Stock markets are freaking out about the spread of Covid-19, the disease caused by a new coronavirus. Should we panic too?
On the surface, the market reactions are grim: Global equities had their worst week since 2008, as traders dumped everything that smells risky. That’s because the full consequences of the virus, which the World Health Organization warns could reach most if not all countries, are still unknown. Supply chains are being disrupted and public gatherings are being canceled, which can filter through to spending and investment.
There’s mayhem in markets, but the shock isn’t comparable to the financial crisis in 2008. Back then, panic in the credit system cut off lending, causing the global economy’s gears to stop turning. The past few days were different. In the US, an overheated stock market—shares were at a record high last week—started coming to terms with the possibility of slower economic growth. Risks are still lurking, but banks have been fortified.
The coronavirus outbreak isn’t likely to spark a recession in most developed countries but, according to economists, they are far from invincible. Italy and Germany’s economies were barely growing before the virus fears spread. China’s had already been hit by the trade war. A slump is possible in the US, says Allison Schrager, a senior fellow at the Manhattan Institute, but not yet probable.
Much depends on whether authorities are able to contain the virus, and the resilience of the world’s economy as the disruption intensifies.
The US has some momentum and room to maneuver, but its options are limited. The Trump administration is looking at $1 trillion budget deficits, leaving it little room to cushion a downturn through spending. The Federal Reserve can cut interest rates to goose the economy, but rates aren’t much above zero. Central banks in Europe and Japan have even less firepower.
That doesn’t mean it’s time for us to panic. But it shows there’s little margin for error, which is why traders hit the sell button. —John Detrixhe
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Don’t worry, your links are coming. We’re just trying something different today. Instead of telling you what our favorite stories of the week are about, we’re going to tell you why we loved them. Picture the staff selections table at a bookstore, or that friend who won’t stop talking about The Witcher. Should we keep this up? Let us know at the bottom of this email, or email us at email@example.com.
FIVE THINGS ON QUARTZ WE ESPECIALLY LIKED
The dark side of the flight attendant lifestyle. “This richly reported feature explores the hidden side of a profession both ubiquitous and overlooked. Natasha Frost folds the accounts of flight attendants who have struggled with addiction into a broader story about the perils of the profession and an industry ill-equipped to deal with its disturbing realities.” —Oliver Staley, culture and lifestyle editor
How religion is playing a role in the spread of coronavirus in Korea. “I did a double take when Reuters reported that South Korea was going to be mass testing 200,000 members of a church at the center of a coronavirus outbreak. Thankfully Isabella Steger provided the context, explaining the central role of organized religion in the lives of South Koreans, and as a result, in the disease’s rapid spread.” —Jackie Bischof, deputy membership editor
How to deal with uncertainty like a poker champion. “Meghan McDonough does an incredible job turning an esoteric topic like risk into a fun and relatable series of videos for Quartz members. A perfect example comes about two minutes into this episode, when she and German psychologist Gerd Gigerenzer use the story of an oblivious turkey to explain why risk models fail. I walked away with a better understanding of why risk is not something we should fear, but embrace.” —Jacob Templin, executive producer
How Kenyan women are bringing P&G to task. “In early 2019, Kenyan women started sharing online their negative experiences using Procter & Gamble’s Always pads. The hashtag #myalwaysexperience trended as P&G failed to accept responsibility for the problems, among them rashes and severe burning sensations. In this investigative piece, Ciku Kimeria tells the story of the unrelenting movement to get one of the world’s largest corporations to address consumers’ issues.” —Yinka Adegoke, Africa editor
Listen to precious-metals sellers manipulate elderly conservatives. “Thanks to Hanna Kozlowska, Jeremy B. Merrill, and Daniel Wolfe, we get the striking experience of actually hearing how salespeople use the fear of immigrants, an affinity for the Bible, and the supposed authority of Fox News to help talk seniors into buying precious metals at Metals.com, which has been accused of selling overpriced gold and silver coins.” —John Keefe, investigations editor
TikTok is China’s first truly global app. With hundreds of millions of monthly users and burgeoning TikTok stars, ByteDance’s hit video app is here to stay. But “TikTok’s roots are a double-edged sword,” writes Quartz reporter Jane Li. This week’s field guide for members tells you why.
FIVE THINGS ELSEWHERE THAT MADE US SMARTER
How contagious is Covid-19? This chart puts it in perspective. “If you want an antidote to nerve-wracking coronavirus headlines, take a look at the chart in this Popular Science story, which shows how infectious the new virus is compared to some other diseases. The value it tracks, which epidemiologists call R0, is still an estimate, and it will change. But understanding the dynamics that contribute to viral spread—and hopefully, eventual herd immunity—will help put the next weeks of news in context.” —Katie Palmer, science and health editor
Revisiting the Tocqueville Paradox. “Inequality isn’t rising in Latin America, but protests against inequality certainly are on the up. Through a thoughtful data analysis, this post by World Bank researchers suggests that it is actually an expanding middle class that makes people more frustrated by inequity. These people have the exposure to the wealthy to understand what went wrong.” —Dan Kopf, senior data reporter
Quarantines won’t save us from coronavirus. ”This story in FiveThirtyEight neatly flips conventional wisdom on its head, using historical examples to help clarify one of the biggest talking points in the fight against the coronavirus. Isolation, as it turns out, is not quarantine, and neither one is very effective—they both tend to be leaky and panic-inducing. What will help? Better communication about best health practices and more widespread testing.” —Tim Fernholz, senior reporter
“I fail almost every day”: An interview with Samin Nosrat. “Nosrat is the author of Salt, Fat, Acid Heat, and I love her awkwardness about her identity in this New Yorker interview: how she refers to herself as an ‘immigrant kid or whatever,’ displaying awareness of the strangeness of being other at home, nostalgic for lands not really your own. I especially appreciated how she sees her perpetual people-pleasing—that need to fit in while sticking out—as a superpower, not a weakness.” —Ephrat Livni, senior politics reporter
My ex-boyfriend’s new girlfriend is Lady Gaga. “Celebrities—they’re just like us! Well, not exactly, but this lovely New York Times piece puts a positive spin on the mind-boggling experience of finding out that an ex-partner is now dating one of the most famous people in the world. As the writer puts it, ‘Comparing yourself with [Lady Gaga] is incredibly motivational, and I recommend you try it.’ Inspirational words for your weekend.” —Natasha Frost, travel reporter
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