Archive for the ‘Global Politics’ Category

Covid19 – potential exit strategy

2020/04/24
Disclaimer:
Please note that things are changing very fast on Corona virus. Scientists are working hard to find a vaccine. Hence, the content of this blog could become out of date very soon. This blog is for information purpose only and does not constitute as medical advise. Always follow the advise from your doctor and relevant medical authority in your country.
How can lock down be lifted?
The key question for most part of the world is now how to end the lock down without a massive risk of life of citizens.

As of this writing, there is no known cure for Covid19.

If nothing is done, entire population will eventually catch the virus and around 1% of them will die.

If we could confirm who are immune to the virus then we can easily identify the vulnerable and ask everyone else to carry on with life as usual. However, the problem is, other than identifying aged people (e.g. those with 65 years and above) and those with existing health conditions (e.g. obesity, cardiac issues, diabetes etc.) there is no finer way to identify the risk group. Even them, some young and healthy people are randomly affected in a serious manner, even resulting to death!

Millions of people around the world have got infected with Covid19. Some have suffered no or mild symptoms only. However, due to very little testing carried out, majority of people who think they have got Covid19 and recovered, have no way to confirm that that is actually the case!

The crux of the problem here is how to identify people who got Covid19, then recovered and thus assumed immune to it. These people can then come out of lock down and start leading a pre-Covid19 life.

So how do you confirm this? This is where the difficulty lies.

Presence of the virus can be confirmed in 2 ways – swab test and antibody test.

The swab test shows if the virus is present at the point in time (when patient is tested).

WhatsApp Image 2020-04-24 at 12.08.57
The antibody test can detect patients who suffered and recovered but up to a certain period of time. The big unknowns are [1] how long antibody will remain in the body [2] whether the antibody is due to Covid19 only or for some other viruses.

Although there are cases for person being affected again after recovery, but in this writing we are assuming subsequent infection would not be fatal .

Now if we take a person A, who got infected by Covid19 but suffered only mild symptoms and recovered after 21 days, then the question remains how to prove it? He can be tested for antibody and if IgG antibody is found, a reasonable conclusion can be drawn that person A is immune from Covid19 going forward.

But this approach has a major hurdle. Firstly, antibody test is not yet available to everyone. Secondly, by the time antibody test is available to everyone, the concerned person may have lost the antibody from his blood stream. In this case, it is back to square one!

WhatsApp Image 2020-04-24 at 12.12.16
This person is now in same position like one who has never caught Covid19 before (say person B).

To the public, person A is having same risk of person B. But in reality person A is possibly immune and carry far less risk than person B. But there is no way to prove it.

For person B, there is a risk that he could suffer mild symptom or sever symptom and could even die.

If the immunity can be proved beyond doubt, then it is a valid exit strategy.

Without proper tests, we have to adopt any of following situations.

[1] Lives saved but economy damaged

Continue lock down indefinitely. If everyone remains isolated, no one will get infected, hence no one is contagious and no new person gets infected. But this will destroy the economy and livelihood of billions of people. This is not acceptable solution to public – even though this is actually best solution for saving maximum amount of lives. After sometime public may revolt and might just start their normal life anyway.

[2] Economy survives but high number of casualties

Allow people to carry on as usual and achieve so called herd immunity. This means allowing everyone to catch the virus and accept 1% death of overall population. Effectively a situation a very large number of random people will die. This scenario does not try to prevent infection, rather relies entirely on individual’s body immunity to tackle the virus.

What is the future then? Well, only time will tell.

Thanks to Dr Somnath Mukherjee and Dr Shyam Das for their inputs.

Why single currency is not good thing?

2012/05/15

Recently there is daily news on Euro collapse. Here we are not speculating whether Euro will collapse or not but we shall examine whether single currency is a good idea or not.

Before the currency system was invented people used bartering system to conduct trade. For example, you give me fish and I shall give you few eggs. Obviously it caused problem when buyer and seller did not have any common product for exchange. The introduction of currency (i.e. paper notes and coins) solved this problem.

If several countries use same currency (like Euro), there are benefits and pitfalls. If a country has its own currency, it can devalue that to make their export appear cheaper to outside world. That means they can offer cheaper goods to other countries. While their own citizens can’t buy those goods so cheap, they can still earn a good living within their home country. Of course this assumes that they produce goods which are in demand in other countries. China is a good example for this. They produce so many good for the whole world but their own citizens can’t afford all those luxury items. However, the wage they get by selling these products, they can afford basic necessities in life like food, shelter etc.

Another example is controlling of economic policies. A country can reduce its national interest rate to encourage businesses to borrow money (which will then roll into economy). If there is inflation, then government can tackle it by raising interest rate.

So, simply speaking, own currency gives the government to regulate their own economy in easier way.

But own currency has drawbacks as well – mainly for outsiders who invest in that country using that currency. Since government can devalue the currency (say Greek Drachma), an outsider (who invested in dollars) will see their asset reduced. For example, they invested $ 100 at the beginning when $1 = 10 Drachma. But later government made it $1 = 20 Drachma. So their asset is now worth just $50.

When many countries use single currency, that sort of devaluation is less likely. So an investor is more likely to see his asset not losing value – like $1 = €1 can stay for a long time. This will encourage investors to roll more money into common currency market. Thus common currency is better for economic growth.

It will also prevent losing of money during currency fluctuation, commission during exchange etc. – which is considerable if we take into account the daily amount of inter-currency trades.

Single currency works well when all participants have common economic interest. That “common” bit is quite important.

But all the advantages of own currency we discussed before will appear as disadvantage to common market. For example, Greece can’t devalue Euro to attract more tourists. It can’t control its interest rate. If they do so, it will upset other Euro countries like Germany, France etc. So only way to make Greece become competitive is to cut cost of production – by paying less wage to people, for example (which is the austerity measure and naturally its citizens don’t like that).

As we have already stressed a common economic goal is necessary, it becomes problematic when one group of people (i.e. one country) want to eat a bigger share of the cake. If Greek people want a better standard of living by working less hours (i.e. being less productive) it does not attract praise from German people. This becomes a way funding one friend’s lavish lifestyle by another friend. When Greece spent too much, they ran out of money (i.e. cash flow problem). Then other countries had to give them more money (i.e. bail out) to keep their economy going.

Will you prefer funding a friend’s luxury lifestyle when you are struggling yourself? I guess not. That is why other Euro nations are shouting. The way out is to dump the odd friend (Greece in this case).

So what will happen if Greece leaves the Euro zone? In spite of all the scaremongering nothing serious should happen (although there is a probability of short term economic turmoil). Greece will revert to its Drachma. Many banks (or investors) who lent to Greek economy will see their loans wiped off or assets significantly reduced. This may cause for those banks trying to compensate for that loss from other markets – by means of making their products more expensive to others.

In future this can happen to another country. Then they will leave Euro as well. People will then start wondering when the next country will leave. This will hurt consumers (and investors) confidence. People will start to believe that Euro is no longer stable and thus they will try to offload Euro investments. This will cause impact on economy.

If this cycle goes for long, ultimately single currency will lose relevance.

Why CO2 is taxed even though plants use them to release oxygen?

2012/04/29

Usually most new cars are now taxed on carbon dioxide emission nowadays. A car which emits more CO2 are taxed more.

But CO2 are required by trees! During the photosynthesis process, they absorb CO2 and release oxygen.

So technically we should release more CO2 so that plants can produce more oxygen.

Now there are two sides of this story. Usually the authorities claim that there are not enough trees to absorb this much carbon dioxide produced. However, the opponents say it is not easy to calculate how many exact trees are needed to balance the amount of CO2 produced by cars. Since governments often love to find an excuse to tax more, they love the environmentalist argument and try to convince people that CO2 emission is entirely evil. Mind you, CO2 itself is not the worst element to come out of a car’s exhaust! Also, it is not that all CO2 is produced by human activity alone – in fact human is responsible for less than 5% generation of CO2. The rest are generated by nature itself.