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NYSE Suspended Trading After Stocks Tank: Trump Clueless?

An automatic circuit tripper was triggered this morning when the NYSE opened due to the worst drop in the Dow Jones average since the financial crisis of October, 2008 (and before that, 9/11):

The Dow Jones Industrial Average tanked 1,247 points — 4.8% — on pace for its worst day since December 2008, while the S&P 500 plunged 4.9%. The massive sell-off triggered a key market circuit breaker minutes after the opening bell. Trading was halted for 15 minutes until reopening at 9:49 a.m. ET. At one point in morning trading, the 30-stock Dow dropped 2,046 points and the S&P 500 cratered 7.4%.

This is the first time the trigger was activated since 1997.

As for why the Dow freaked out, it's fears over the oil trade deal and the coronavirus.[More...]

Even the stock share prices in Gilead Sciences, which is in the testing phase of a drug called Remdesivir to treat coronavirus is not responding upward the way analysts expect it would, likely from being slowed down by a lack of eligible recruits in China.

[Giliad and] Regeneron Pharmaceuticals are both making progress in developing treatments for coronavirus, according to a report published Monday by Leerink Research. But the stocks were off more than 4% in afternoon trading, a sign that investors remain skeptical.

Early indications are that Gilead’s (ticker: GILD) antiviral drug Remdesivir, originally developed to treat Ebola virus, is the most promising treatment for severe cases of coronavirus, analyst Geoffrey Porges writes.

Here's an article from February on how the testing was progressing. . Here is the Wall St Journal's stock graph for Gilead.

As for the virus itself, New York now leads the nation with the most confirmed cases -- even the head of Port Authority of NY and NJ, Rick Cotton, has tested positive.

Sen. Ted Cruz has self-quarantined after shaking hands with a man who tested positive at an event called the Conservative Political Action Conference.

Even Donald Trump, who attended the same conference, has been personally exposed by his physical contact with two congressman who are quarantined.

Two Republican congressmen had contact with President Donald Trump before they announced they were entering self-quarantine because they were previously exposed to someone who has since been diagnosed with coronavirus.

Rep. Doug Collins of Georgia shook hands with Trump last week. Rep. Matt Gaetz of Florida flew on Air Force One with Trump on Monday. Both Collins and Gaetz said Monday they were self-quarantining because they had been in contact with a person at the Conservative Political Action Conference who since has been diagnosed with coronavirus.

Italy has just extended its quarantine to the entire country. Israel announced today it will require anyone entering the country to be placed in quarantine.

Will coronavirus be Donald Trump's political Waterloo? I think it's possible but not yet cast in stone. I do think it's possible that by the time the coronavirus has run its course, the damage to Trump could make Hurricane Katrina seem like it was just a puddle in the path of GW Bush.

How is it possible that Donald Trump, who has a business degree from the Wharton School, does not understand the scope of economic doom this virus is capable of causing? Can Wharton please send a tutor to the White House to explain the situation to Donald Trump, who seems even more dense than usual on this topic?

One other issue to worry about: raw materials for a huge amount of our prescription drugs come from China, so that if it is no longer safe to import drugs made with Chinese ingredients (or for India to import the ingredients from China, which then manufactures the drugs and sends them here and to the rest of the world) there would be a shortage of prescription medicine in the U.S. and around the world. Last week, India began limiting ingredients imported from China.

India’s pharmaceutical companies source about 70% of their ingredients from Chinese factories, many of which have been shut for weeks owing to the coronavirus outbreak. The closure of airports in China has also impeded supplies reaching India.

...While many Indian factories had stockpiled ingredients due to the lunar new year, those supplies are running low and most factories are covered only until the end of March.

Sahil Munjal, the vice-chair of the pharmaceutical export promotion council of India, said the restrictions could have a lasting impact on the global availability of commonly used drugs.

Munjal also stated the somewhat obvious consequences: drug prices will rise if there is a shortage.

The Wall Street Journal has expounded on this a few times. The FDA released a statement three weeks ago saying the agency is on it.

But last October, it said it was pretty clueless too about the exact number of facilities in China and India exporting medicines and drugs to the U.S.
[D]ata available to FDA do not enable us to calculate the volume of APIs being used for U.S.-marketed drugs from China or India, and what percentage of U.S. drug consumption this represents. As mentioned above, we do not know whether Chinese facilities are actually producing APIs, how much they are producing, or where the APIs they are producing are being distributed worldwide, including in the United States.

....Since we do not currently know whether API manufacturing facilities are actually producing the drug, or in what volume, or what portion of U.S. drug consumption is dependent on APIs from China or India, or another country, we cannot perform a reliable gap analysis.

Even if we could estimate the potential API shortfall and available production capacity, pharmaceutical companies make business decisions about whether to produce a drug product, including an API, and FDA does not have the power to tell them to make a drug. This provides additional uncertainty in assessing the potential responsiveness of the U.S. manufacturing base to a crisis triggered by another country’s withdrawal.

And Donald Trump continued his under-informed comments today, comparing the coronavirus to the common flu. He shook hands with several people and said he's not worried.

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  • Display: Sort:
    There is a mistake in the headline (5.00 / 2) (#1)
    by CaptHowdy on Mon Mar 09, 2020 at 04:53:59 PM EST
    You included a question mark at the end.

    Here's hoping (none / 0) (#2)
    by smott on Mon Mar 09, 2020 at 05:39:51 PM EST
    We have elections in November. If I'm Trump, McConnell et al, I'm looking for any excuse to call them off.

    Stealing a line from The Rainmaker (none / 0) (#3)
    by Chuck0 on Mon Mar 09, 2020 at 10:33:26 PM EST
    He is stupid, stupid, stupid.

    He tweeted earlier that the diving oil prices will great for consumers. What he is clueless about is that it will decimate the US energy independence. The Permian Basin oil industry will collapse at $30  
    a barrel. I know, I know, there are plenty of arguments against fracking. My point to this is how he has zero understanding how the economy is interconnected. He is only focused om what's good for him alone.

    From a historical perspective (none / 0) (#4)
    by ragebot on Mon Mar 09, 2020 at 11:21:23 PM EST
    Puerto Rico use to be the source of medical drugs for the US.  In some ways this was a political pay off for the commonwealth status it was under.  But there were huge tax incentives that made it very profitable to produce drugs in PR.

    For many reasons this status changed resulting in PR taking a huge hit in it's economy and the big drug companies moving production to cheaper countries.

    As China started developing what I will call reasonable, or even unreasonable, regulations governing biomedical research were lagging; or more likely simply nonexistent.  The result was some of the best research was being done in a country with cheap production facilities and no real govt jurisdiction on the research and production.

    With no FDA or clinical trials required as well as no public interest groups opposing things like stem cell research it makes sense that China is in the position it is in.  But I am not sure it will continue to hold that position if the supply of drugs is disrupted.  

    Great (none / 0) (#5)
    by CaptHowdy on Tue Mar 10, 2020 at 09:40:04 AM EST
    Exchange of the Day

    March 10, 2020 at 10:33 am EDT By Taegan Goddard 1 Comment

    Speaker Nancy Pelosi was asked by CNN's Manu Raju if she thinks President Trump should be tested after his interactions with Reps. Doug Collins and Matt Gaetz, who are now in self-quarantine.

    PELOSI: Tested for what?

    RAJU: Coronaviru.

    PELOSI: Oh, I thought he should be tested for a long time now.

    Also the new Chief of Staff Mark Meadows is now in quarantine as the virus picks off the crazies one by one.  

    The only (none / 0) (#6)
    by Ga6thDem on Tue Mar 10, 2020 at 02:45:50 PM EST
    good thing about the coronavirus is it has done a miraculous thing in getting people like Ted Cruz to go into hiding. Meadows going into hiding is a bonus.

    Parent
    So far, Meadows (none / 0) (#7)
    by KeysDan on Tue Mar 10, 2020 at 04:09:12 PM EST
    Is beating the Mooch in the shortest tenure sweepstakes.

    Parent
    Yes, but his (none / 0) (#8)
    by Zorba on Wed Mar 11, 2020 at 11:24:21 AM EST
    Fellow Texan Louie Gohmert, although also exposed, refused to self-quarantine.


    Parent
    We have no idea (none / 0) (#9)
    by ragebot on Thu Mar 12, 2020 at 01:29:57 PM EST
    how serious the Corona virus is/will be.

    The stock market fall is largely based on the hit the world economy will take even if the outfall from the virus does not result in the hit it seems to be headed for.

    Just saw this today; there are mass graves in Iran visible from space.  It is not clear why Iran seems to be the second worst hit country after China.  By the same token Norway has basically shut down it's boarders to limit exposure from the virus by requiring everyone entering Norway from anywhere other than another Nordic country will be required to be home-quarantined, regardless of symptoms -- one of the most drastic measures taken in Europe so far.

    It seems like every day there is more really bad news about the Corona virus.

    Sanders is live (none / 0) (#10)
    by CaptHowdy on Thu Mar 12, 2020 at 02:12:08 PM EST
    ...where is Biden?

    Ok (none / 0) (#11)
    by CaptHowdy on Thu Mar 12, 2020 at 02:21:42 PM EST
    He's there

    Late

    Parent