The Great Coronavirus Crash Of 2020 Is Different

The head of Korea’s Centers for Disease Control and Prevention has emerged as a role model for virus-fighters

- Peter Coy 21 March

The Great Coronavirus Crash has been frightening in its speed and breadth. Stocks have lurched lower worldwide, with brief rallies between the falls, like wounded bulls in a corrida. Through 1 pm on March 18 the S&P 500 index was off 27 per cent for the year to date, Germany’s DAX was down 38 per cent, and Japan’s Nikkei was off 29 per cent. In the credit market, investors have fled junk bonds. Even US Treasury bonds — traditionally a safe harbour in crisis times — have come under pressure, possibly because investors are selling them to cover losses elsewhere.

“This is different. The thing that is scarier about it is you’ve never been in a scenario where you shut down the entire economy,” Steve Chiavarone, portfolio manager and equity strategist with Federated Hermes, told Bloomberg News on March 16. “You get a sense in your stomach that we don’t know how to price this and that markets could fall more.”