 The radical, fundamental principles of freedom, rational self-interest and individual rights. This is The Iran Brookshow. Hey, welcome everyone from listening from wherever you might be, probably in some area where you are. I'm under cofuse. I can't leave the house. You might be under cofuse or you're probably at home because you can't go to restaurants, you can't go anywhere, really. We just went out for a walk, made sure to get home in time for the cofuse. Actually, the cofuse only starts in an hour. But welcome everybody. So I'm going to do the show again today on coronavirus. I think there's enough here to keep talking about and there's not, doesn't seem to be much. If you listen to news, if you watch the news, there doesn't seem to be much going on in the world other than the coronavirus, at least not news I can get. So we're going to talk about this. And a few things I want to cover today, really coming out of my conversation with Alex Epstein yesterday, which I encourage you all to watch. I saw a number of comments on Facebook and other places relating to the conversation with Alex that thought it was we were being too dismissive of, to put it politely, I guess dismissive of these government actions, of quantines, of shutting down whole cities, of forcing businesses to shutter their doors, restaurants and so on, that we were being too dismissive of that and too uncaring about the lives of people and hey, isn't this an emergency and isn't this exactly what government is supposed to do and isn't this exactly what needs to happen during an emergency and isn't this like war. And in war, stuff happens and you got to do what you got to do in order to save society and to save civilization. And if the government forces the restaurant I like to go eat at, why would I complain anyway? I shouldn't be going to the restaurant anyway because restaurants are really, really dangerous and I'm contaminating people and I seem to be uncaring about other people. And I don't care if people get the disease and die. So I wanted to address that whole issue because I think there are a lot of fallacies there and there are a lot of problems that, first of all, I think it misrepresent to some extent what we actually said. But I also think that it is the real problems here. And so I want to talk about a few things. I want to talk first about the actual risk involved in coronavirus. What is it? How to evaluate it? How to think about it? What do the numbers actually say? It's like economics, right? People spout numbers. They talk about numbers. They throw this stuff out. But it's good sometimes to just step back and try to be objective and try to find an objective source. But what is it? And then what is the real risk involved and who is at risk? And then given that, what are the issues? We hear a lot about overloading the healthcare system and that's a real concern. But why is that an issue? How did it become an issue? Why is the healthcare system so fragile? Who's at fault? I think that's important. But also, to what extent do we know, to what extent the healthcare system is fragile and is about to collapse? And hospitals and other healthcare professionals doing anything about it. I mean, that's important information to know before we go panicking that the world is going to end. You know, what are the facts about this overload? And then are there ways in which we could address healthcare overload that don't involve shutting down whole cities, shutting down whole businesses and telling each and every one of us what we can and cannot do in the minutiae of our lives? And we can talk about what is an emergency and what is war and why this is not war. And then what is the role of government? And I talked a little bit about the role of government. So a lot of this is about being objective about what this is all about and really what is going on. Let's start with risk assessment. Let's start with risk assessment. You know, anytime you hear about a disease or something communicable or any kind of new phenomena that you are going to be engaged with or susceptible to, it is incumbent on you as a rational human being to do a risk assessment. And the first thing when I think about the coronavirus is I think about, okay, to what extent am I and the people I care about and the people around me, to what extent are we at risk? What is the risk and to what extent are we susceptible to that risk? And who is susceptible to the risk? And particularly if it's a communicable disease that is something that I can have an impact on others, then I want to know on who are these others that I can have an impact on? So I think it's important to look at this. Now, the science is incomplete here. There's a lot we don't know. There's a lot of stuff that's going to come out in the weeks and months ahead. There's a lot of missing pieces here. And there's also some, looks like some variability between locations geographically, and we don't completely yet understand why that is. But let's start with just some straight numbers. And the numbers primarily come out of China. Now, I know you're going to jump at me and say, we can't believe the numbers in China, they're all wrong and so on. And to some extent, I agree with you. But on the other hand, the World Health Organization, which is basically a bunch of doctors and experts, went over to China and looked through the records and looked through what was going on. And I think, to some extent at least, brought some objectivity to the numbers that were being reported, at least out of the one city where this was in Wuhan, where this was particularly bad. So I think that it's not outrageous to look at these numbers. And it turns out that if you look at these numbers and you compare them to South Korea and you compare them to the United States and you compare them to other places, they're not wacky, they're not completely out of whack, they're not completely different. So let's look at the numbers. So first question is, who is at risk? Who is at risk in even contracting the disease that is getting sick at all? Getting coronavirus based on all the testing. And I guess to some extent based on symptoms because my guess is they didn't test everybody, they only tested some people and certainly everybody who had symptoms. They did a lot of testing in China. And what they found was that almost all the people who got the disease were older. So and here older means 30 plus, right? So 78% of all the people who contract actually got the disease were between the ages of 30 to 69, 30 to 69. Only 8.1% of cases were 20-somethings. Only 1.2% were teenagers. And an amazing statistic to me and something that I'm curious, what the scientists ultimately are going to tell us about the cause of this, only 0.9% were nine or younger. So only 0.9% of the cases were children, young children. And that's strange and that's not the case with the flu and that's the case with the cold, at least not these kind of numbers. So first of all, this disease, just susceptibility to these diseases, has something to do with age and your immune system, what you've been exposed to, I don't know. But the younger you are, the less likely you are to get it. Now, I think that's just something about the risk of keeping schools open. Kids are not the problem. The teachers might be. The teachers might be worried. But the kids are not the problem. Now kids might carry it and we'll get to that, we'll get to. But again, kids don't even get it. So they don't carry it. So again, now it could be that kids weren't tested, but my guess is in every society, people test kids because they're worried about kids. But the evidence suggests that kids don't get the disease. Not just that they don't get sick or very sick from it, that is clear. Almost no deaths in children. But that young kids don't get it. Now, to some extent they've tested it, but some kids have been tested. Large numbers of kids have been tested. They know their body somehow doesn't respond to this. I mean, this is not me making it up. This is again, this is the empirical evidence. Now, yes, it's true. Fewer kids are tested. But there's no evidence. There's no evidence that kids are carriers, that kids give this disease to their elders, that kids spread it. It's true that they do as flu. They do it the cold. In this case, it doesn't look like it's true. And again, we'll get to who is susceptible and what you should do with kids given that some people are susceptible. So 78% of 30 and 69, it looks like 9, I don't know, about 10% are below 30 and about 10% above 69, 10% of the people who have it, above 69. Now, the problem is here, so that's one. It doesn't look like everybody gets it equally. Not individuals, but not even age groups, even getting it. And then the question is, okay, so you got it, so what then? Clearly, and I know you've all heard this, 80 plus percent of people have very, very minor symptoms. Some have cold flu-like symptoms but can manage at home. Some are asymptomatic. They don't have any symptoms. So they're walking around carrying it and they don't have any symptoms. So there's nothing. It is fatal for very few people. Now there's a big debate about the percentage of people that it's fatal for. And again, there's a lot of disagreement and there's a lot of speculation. But the best statistic, you know, the guy I trust is Amish Ajallah and I'm not the only one. He's on television, all the networks and everywhere and Sam Harris and everywhere. And his number is 0.6%. So the risk of dying from getting this, if healthcare is decently provided and we'll get to that because that's an important caveat, is probably 0.6% or, as Amish says, maybe lower if healthcare is better because that estimate includes the possibility healthcare is not good. But 0.6% is a meaningless number. 0.6% is a meaningless number. Because if you're 80 years older, older than you get the coronavirus, your fatality rate is 14.8%, 15%. Sorry, I'm Amish, I keep making the mistake. 15% are people 80 or older. And that's because they have a weakened immune system. They have other diseases. They have lung problems and so on. Now, 15% is a long way from 0.6% or if you believe the higher numbers like 3%, 3.4%, even if it's 3.4%, it's a meaningless number. Because the question is what is your, you, you specifically and the people you know, what is your probability of dying if you get infected? What's your probability of getting infected? And then what's your probability of dying of getting infected? The older you are, at least above age 30, you're very likely to get it. I don't know, we don't really have stats about that. But even in Wuhan with a population of millions, right, only 80, some 72,000 people got it. But if you're 80, you've got a good probability of getting it. And then you've got a really high probability of dying. So your behavior if you're 80 is going to be different than somebody else's behavior. By contrast, if you're 50-something, the rate is 1.3%. Now, that's still high. 1.3% is still high. I don't like that, I'm 50-something, I don't like the 1.3%. But again, if you dig into the numbers, the 1.3% is not all 50-somethings. That is a combination and average across all 50-somethings. Some of whom are smokers, some of whom have bad health habits, some of whom are just unhealthy, have bad lungs, and some of whom are completely healthy. The probability if you're completely healthy and a 50-something is well, well below 1.3%. And if you've never smoked and if your lungs are in good shape, again, the probability of you specifically, the person you should care most about, getting it and dying of it if you're 50-something is minute. It's below 1%, significantly below 1%. If you're in the 40s, it's 0.4%. Again, that's the top end because if you're healthy, it's probably below. If you're unhealthy, it's significantly above. So each one of you has a different probability. If you're between 10 and 39, the probability is 0.2%. And if you're below 10, the probability is very close to zero. So if you smoke and you have bad health habits, Moise, and you're 25, then your probability is more than 0.2. How much more I don't know? But it's more than 0.2. And if you're healthy, don't smoke and you're 25, then your probability is very close to 0. So first, assess your own probability of dying, of getting really, really sick and dying. Assess your own probability of getting the disease. So getting it also involves figuring out how many people in your community that you interact with probably have it. And you can get statistics about where you live and how many people have it or at least how many people are tested. And this is one of the big problems of not having testing is we don't even know. But you've got a multiple probability of you specifically getting it by the probability of you getting really ill or you dying. And when you start multiplying these probabilities, you will see that your specific probability is very, very, very low. And that's true for your wife and that's true for your children. That's actually doubly true for your children because your children have very low probabilities of getting it and of getting sick from it. So again, you've got to think about these things and you've got to think about it probabilistically. You've got to think about the probabilities. And you can just say, oh, there's a 3% chance of death. 3 in every 100 people are going to die. That's just not useful information. First of all, it's probably not 3, it's probably 0.6. But even 6 in every 1,000, which is what 0.6 means, are going to die. Oh, that's a big number. But is it true? That's 6 of every 1,000 who get infected. True. But 1,000, what's the demographic breakdown of the 1,000? So for example, one of the reasons death rates and severe illness rates in Italy are so high is because Italy is the second oldest population in the world. So there are a lot of old people. But it's more than that. Italy has a culture of intimate social relations. Everybody hugs and kisses in Italy. And extended families live together. And older people are exposed on a regular basis to young people constantly. And so young people who might travel, come back and give it to old people because they're constantly interacting in Italy more so than in China, more so than in South Korea where they are. Even though South Korea is a relatively old population, it's not as old as Italy and they're not as intimate as they are in Italy. And they don't live together quite in the same way as they do in Italy. And you know Asian cultures, Asian cultures are a little distant. They don't hug and kiss all the time, like the Italians do. So these factors affect transmission and particularly transmission of those vulnerable who are the elderly. So who you are, what age you are, how healthy you are, will determine your risk. Nobody else can decide the risk for you. You know what that risk is. So first you have to think of your own risk here. And then we'll get to what happens how you reduce risk. Because there are easy ways, if you understand this, then there are easy ways to reduce risk. That is, I mean the primary way to reduce risk is. And this reminds me of after 9-11 of our reluctance to profile. So after 9-11 I remember going through the TSA machines at the airports and they would frisk 8-year-old blonde little girls. And you could be a Muslim with a full Muslim garb and go right through because the frisking was random. They wouldn't profile. You know who the risk is coming from. You know that young Muslim men are the likely suicide bombers. You know that they are the ones that are most likely to engage in this behavior. That too, you focus on profiling is completely rational. And you know the Israelis profile really, really well when it comes to terrorism. But it's politically incorrect to profile. And it seems like with this coronavirus, it's politically incorrect to profile. Because what we should be doing is profiling. We should be saying, if you're 65 and older, suddenly if you're 80 and older, if you're sick, if you've got a compromised immune system, if you've got lung problems, then don't go out. Don't visit with your grandkids. Hey, children, adult children of older parents, don't let them go out. Hire them, somebody to assist. Make sure food is delivered to them. Government, since you're redistributing wealth anyway, set up welfare programs if this is what you do anyway. Set up welfare programs to assist elderly people so that they don't have to go out and they don't have to be exposed to people. Isolate them. If your mother-in-law is living with you, lock her in a room. I don't mean that literally. I mean, encourage her to stay in a room. Don't socialize with her. Wear a mask when you talk to her. Wear gloves when you deliver food or you prepare food for her. Do the things that are necessary in order to reduce the risk of the people most at risk. Because the fact is the risk of a 40-something or under 40-something of dying from this disease is insignificant. It's less than the flu. Again, if you're healthy. So why not tailor our solutions to the actual problem? The problem is that when old people get coronavirus, when the likelihood of death goes up dramatically, then let's find a solution to isolate older people. No. We have to isolate everybody. Nobody can go to restaurants. And the reason it's given is, well, you might not get any symptoms and you might not die, but by going to restaurants you'll give it to other people and they will go home and then interact with their mother-in-law and see their father-in-law or father-in-law old age home and give it to him and then he'll give it to other people in the old age home. He said, don't go visit the old age home. But why should I who have no risk involved here and the wait staff at the restaurant which are very low risk not be able to enjoy a nice meal at a restaurant? What is the harm that we are doing? What is the danger that we pose to society? Now, down if 80-year-olds come to the restaurant, they're in danger. The restaurant could have a policy not to serve 80-year-olds. I mean they could have a big sign outside. If you're over 65, go home. It's just mind-boggling to me. If my wait staff smokes, then they should stay home. If my wait staff is worried about getting the virus, they should stay home. But again, if each one of us takes responsibility for our own risk, and for not spreading it to people who are truly vulnerable, the elderly, the sick, then this thing stops. But if we assume that people are stupid, that people can't take care of themselves, that people can't think for themselves, that people can't assess risk for themselves, that people if told, hey, your parents are in danger, don't go visit them, and they do, they're going to do it anyway, because they're not going to listen to you, because they're stupid, because they're immoral, because they don't care. If we assume all those things, then you need government, then you need the philosopher kings. You need government to come and impose these restrictions on us, because we cannot do it ourselves. I mean, I wouldn't ban old people from coming to restaurants. I would urge restaurants to ban old people from coming to restaurants. And I would urge the government and those who are being listened to, I would urge them to tell old people not to go to restaurants. Now, I have to say this, and I find this interesting, that the British government is doing something similar. Now, we'll see what actually happens, because there's an immense political pressure to do a lot more than they are doing. But basically what the government has said is that they're not banning travel, they're no travel restrictions in the UK. They are not banning assembly. They're not closing restaurants, not yet anyway. But what they're going to be doing, at least according to what has been released so far, is that probably next week they're going to tell anybody over the age of 65 to isolate themselves in their home for 12 weeks. They're going to close all nursing homes, two visitors, and they're just going to isolate the elderly population in the UK for 12 weeks. Now, again, I don't think you need coercive measures to do this, but that is better than penalizing all of us. Again, profile. Who's at risk? And school children are not at risk. 20-year-olds are not at risk, college students are not at risk. But notice, the United Kingdom has no travel restrictions, unless you're from one of the 11 countries that get to the hotspots. No travel restrictions. They're recommending, I think the latest, the government recommended, people not take cruises. Now, again, why are cruises so susceptible? Why is there so much in cruises? Because old people go on cruises. The average age in a cruise is very high. Yeah, it's dangerous, but the danger for a young person to go on a cruise is primarily getting stuck on one that can't find a port of entry and being isolated from the world. As Alex mentioned, I will be 60 in 18 months, a little less than 18 months, which is even scarier, 15 months. I'll be 60 in 15 months. I'm not worried. I'm in good health. My lungs are in good shape. I exercise, probably not enough, but I exercise. I eat well. As I said, I was on an airplane a few days ago. A number of airplanes a few days ago, I gave a talk, I gave a lecture in Denver, Colorado. I'm not worried about me. Now, I get being worried about your parents. I've been communicating with my parents the last few days and telling them, don't go out. And I texted to my brother and my brother said, I don't live near my parents. My parents live in Israel and I live here. And I texted with my brother who lives close by and I said, you know, you make sure they don't go out. And he said, yeah, but they don't behave themselves. They keep cheating and sneaking out, right? Well, they shouldn't. They shouldn't. All right. So that's a lot of this is about being objective about the risk and then adjusting your behavior to that risk. Now, there's no reason to get sick. There's no reason to get sick. So, you know, I'm not shaking hands with people right now. You know, I wouldn't go to a party. I wouldn't go to a crowded place. I'd go to a restaurant because I think I, I don't think restaurants are that high risk. I know people think otherwise, but I would go to a restaurant partially because restaurants are a high value for me. I would go to a party. I wouldn't go to a sporting event. I understand why sporting events were canceled. By the way, all voluntarily, NBA canceled voluntarily. The Hockey League canceled voluntarily. Now, there's an argument, I guess, Peter Schiff has made that maybe they feel litigation. That's possible. But litigation is not always illegitimate. It might be, but it's not always illegitimate. Notice that all these events were done voluntarily. You didn't need government to shut them all down. Restaurants need to be shut down, but not. So I would engage in what people are calling social distancing because I don't want to get sick. And I don't want to even, if not my fault, to be responsible for transferring the virus in some way to some older person who might really get sick and might die. It just, I'd rather not do that. So I wash my hands more than usual. When I was traveling, I tried to wash my hands a lot on the plane. Off the plane, I used the stuff, the disinfectant that they had in the Atmos Club. You know, you do what you can to do the hygiene, to follow the hygiene recommendations, to follow distance between people. I'm not hugging anybody anymore except my wife. She's either got it or doesn't have it. It's too late. And then, so if you're an individual, I don't know what more of that you need to do. Yeah, it's rational not to want to get sick. It's rational not even to take a 0.0632, whatever chance. It's rational not to be a minister to people by transferring the disease to them. Just follow basic distancing principles. Make sense? And if you can work at home, work at home. If your employer lets you work at home, work at home. We don't need to shut down everything. Now, if you know you're infected, then that's different. And again, this is where testing would be so good. It's interesting in the UK, they're not testing much either. They're basically saying everybody's going to get it. That's the attitude. Everybody's going to get it. We want to make sure we don't overload the hospitals, but we're preparing for that. And the best way to not overload the hospitals is to get the old people who tend to go to hospital to get them quarantined. And there's no point in testing because we know ultimately most people are going to have it. But I would like to be tested. I would like to have a kit. I would like to have a drive-through place where I can go and get a test. And no, I don't have it. Cool. I travel a little bit now. Get tested again, see if I have it. Now, if you have an infection, and you're young and healthy, then if you have an infection, you isolate yourself. You don't want to give it to other people. So if you know you have the infection, then it makes sense for most people, not for everybody, to isolate themselves, to find ways to isolate yourself. But for that you need to do. You need to know. Businesses have to make a call. I mean, businesses don't want to kill their customers. So again, I would have big signs. Nobody over 65 allowed. And then you have to make a call in terms of PR, in terms of liability, you know, lawsuits, in terms of what is the real risk involved, or is your audience to be younger or old? You know, I think the basketball league shut it down because the players were getting sick. Now, it's true. The players have a mortality probability of dying of basically zero, close to zero. But you don't want a bunch of sick guys running around the court who have this virus. And it's just, it's just not right. So it makes sense for businesses to shut down. It makes sense not to have conferences up to a point. But again, let the businesses make the call. Businesses are very good at estimating their own risk, estimating the risk of their customers. They know who their customers are. Again, if it's, if you're doing a conference with 20-year-olds and everybody there's a 20-year-old, risk's a low. Again, if you've isolated the older people, if older people are walking around among us with no constraints, then yeah. But profiling, I'm for profiling, profiling old people. Okay, I want to talk a little bit about overloading the healthcare system. Here's the idea that there are limited number of beds. In the United States in particular, today there's only 2.8 beds per, every thousand, per thousand people. Which is low, low as compared to many countries in Europe, for example. We have, we don't have a lot of beds. We don't have a lot of ICU beds. And then we have respirators. There's a potential shortage of respirators. And hospitals are fairly efficient. So while there are 2.8 beds for every thousand people, a lot of those beds are occupied just from regular pod disease, cancer, people just being sick and being in hospital. And hospitals don't like to have lots of empty beds because it's hard to make money if there are a lot of empty beds. At least as the system exists today. So the fear is, and this has happened in Italy, clearly happened in Italy, is that so many people show up in the emergency room who need hospitalization because of coronavirus. That basically the hospital falls apart. They can't treat their cancer patients. They can't treat the heart disease patients. They can only treat a certain portion of their coronavirus patients. And people are dying. People are dying for a variety of different reasons that have nothing necessarily to do with coronavirus but from the overload on the hospital system. And the ideas we want and flattening the curve, the whole idea of flattening the curve is the ideas we want to reduce the number of people. We want to spread it out. We accept that everybody's going to get it. We just want everybody to get it over a long period of time so that the pressure on the hospitals gets reduced dramatically. Now, somebody's asking about the April Chicago EOI event. You'll probably hear in the next day or two. I'm not supposed to publicly make an announcement, but you'll hear from the Institute in the next few days. But the way to do that, I think the primary way to do that is again, isolate old people. I know that sounds horrible. Isolate old people. But yeah, it's for their own good. I mean, they should voluntarily want to do this. And again, old age homes and other facilities that cater to old people should voluntarily restrict access to them. And then of course, if you are younger but have health problems, then don't go out. Isolate yourself. And it's hard. I know you might have a spouse that's traveling, but okay, life is a challenge. Sometimes it's a challenge. Somebody says 349 people died in Italy in the last day. Yeah, out of 60 million people. I mean, it's sad that 349 people died, but again, put it in perspective. And they were all over 80, almost all of them were over 70. You look at the list, they're all that way. Italy has the second highest percentage of old people in the world. All right, so let's go back to this bed's problem. So first, the way to deal with this is again to try to make sure that the people most likely to show up in hospital don't get sick. Second, let's ask a question. Why are there so few hospital beds? Why are hospitals not prepared? Why don't they have a plan for this? I mean, if healthcare were private, if insurance was truly private and competitive, wouldn't there be a long-term plan to deal with these kind of things? Wouldn't there be maybe a section of the hospital that was mothballed just for emergencies, just for pandemics? And maybe the first time there's a pandemic, there wouldn't be. But don't you think hospitals would learn that that's what they need? Now, it turns out that a lot of American hospitals, well, so first, why does none of this exist? Well, none of this exists primarily because of government involvement in healthcare. I mean, government has squeezed hospitals. Private hospitals are squeezed by Medicare and Medicaid. They're squeezed by the fact that they have to, have to by law treat anybody who shows up at the emergency room, whether they can pay or not. Hospitals cannot plan long-term. They cannot make significant capital investments in things that are speculative and things that are long-term like mothballing a building in case there's a pandemic. They can't do that because government payments have squeezed them so much and there's no alignment of incentives between government and the hospitals. Government has no interest in thinking long-term. Government has no interest in planning long-term. Government wants to squeeze costs. Medicare and Medicaid are out of control. The budget is out of control. All the government wants to do. I mean, this idea that business is short-term and government is long-term is upside down. Government is short-term. At the House of Representatives, it's on a two-year cycle. At the Senate, it's on a six-year cycle. At the President's level, it's on a four-year cycle. Oh, really, a three-year cycle because it's a four-year cycle, right? There is no long-term thinking in government. Not today. So even if a business wants to think long-term, if it's primary customer, which is the government, not you, the person coming into the hospital, the government is a short-term customer, doesn't care about the long-term, then it's almost impossible to make long-term investments. Now, imagine a world in which the government was not a customer. Where government involvement in healthcare was zero. Where insurance companies insured pretty much everybody, young and old. And insurance companies are for-profit businesses that care about the long-term. And they are now, they're interested in now allowing with the hospital. And insurance companies and hospitals would get together and draw out a plan. It would be in the insurance company's interest to invest in such a plan. Because the cost of the insurance company are going to skyrocket during a pandemic. And the cost of the hospital are high. They would come up with the revenue potential for the hospital are high. They're planning to deal with pandemics, to plan ahead, to plan in advance. But that cannot happen with government involvement in healthcare. All right, now, the other issue is, one second, let me just, the other issue is, do we know that there really is going to be this overload? Oh, by the way, just put it aside once again. Equipment, testing, all of that is heavily regulated, controlled. I mean, do you have any doubt that if testing was all private that we'd have tons of tests? And equipment, respirators, all of that, all of that is regulated, controlled. Who can build them? Who can make them? Under what conditions they can be delivered? Do you know that the regulations tell a nurse in treating patient X what kind of mask she has to wear? Not her judgment, not the doctor's judgment, not the hospital's judgment. The bureaucrats' judgment. I know the people in FDA are not all paper-pushing bureaucrats, some of them are doctors and researchers, but they have a mentality of bureaucrats by definition because they work for the hospital. What about, so all of that stuff, everything to do with setting up a hospital for an emergency like this involves regulations and controls, that yes, create these limits. So if you wanted, so if you wanted to increase capacity in hospitals, what would you do? Well, you would loosen up licensing restrictions so you could bring in doctors and nurses from other states, from other countries, pay them money to bring them in, retired nurses and doctors, pay them enough money to bring them out of retirement. You would allow hospitals to set up field hospitals to take over abandoned buildings, to improvise. You would get rid of all the different regulations about masks and about, let the doctors, let the hospitals who have a strong self-interest here, let them manage this, get the FDA out of it. Now, given the extent to which the government is involved today in healthcare, if the government is going to do anything, then the government and maybe in this case it should and it must because it's so involved in healthcare, the government should now pass a bill in Congress to spend money on buying respirators, on buying tents for field hospitals for, you know, ramping up production of anything that is needed. We've had two months. We could have ramped up production in a variety of different things. By the way, I read this amazing story today relating to ramping up production. So you know Louis Vuitton. You probably have walked by a Louis Vuitton store if you've been to a nice mall. I've walked by Louis Vuitton stores all the time. Never been in one. Not interested. Nothing there I want to buy. Doesn't interest me, right? Louis Vuitton makes luxury goods, bags that cost $10,000, dresses that cost $20,000, makeup stuff, all kinds of things like that that are very, very high-end. Well, Louis Vuitton has just announced that they are transitioning. Some of their production line from things like makeup and perfume to producing hand sanitizers. And they are going to basically do this for as long as necessary. And they're going to provide it to the French health agency. I guess I don't know if it's free of charge or at some minimal cost or whatever. So private enterprise is more than willing in a time of an emergency to ramp up production if called upon and if the red tape disappears and if you don't have the bureaucracy and the regulations and the controls, this shouldn't be a shortage of anything, anything. And it's not about supply chains from China. Purrell that makes all the disinfected stuff is an American company with American manufacturing. Indeed, supply chains are ramping up. So, for example, China is kind of over this virus. They're ramping up production just as we are crushing production. So we'll be able to import a lot of supplies from China while we're shutting down everything in the United States. It's a beautiful thing. The global supply chain, international trade, globalization is amazing in terms of its ability to... I mean, imagine if the United States government or private hospitals or whatever put out bids globally, we need a thousand ventilators in a week. Who can produce them and deliver them and ship them from anywhere in the world? I mean, that's what you want. You want real competition. You want competition not just on price but on speed of delivery. So, no, there's so many solutions to these things. I'll tell you about my thinking later about the state of the world. And then objectively, are we in a situation in the United States where we're really going to get it overloaded? No, I don't have an answer to that. But I read about things like the fact that the Cleveland Clinic has contingency plans, because you know what? There were private clinics and private clinics think long term and they make contingency plans. So they have contingency plans where they end elective procedures. They set up 150 additional hospital beds complete with IVs in a nearby hotel which they've identified or they could set up a field hospital which they've identified and they have the capacity and they have the ability to do it. They say that these contingency plans would give the Cleveland Clinic alone an extra thousand beds to accommodate coronavirus patients. Now, that's a private enterprise thinking long term in spite of all the pressures placed on it by government. HSA Healthcare Inc. One of the nation's largest hospital systems is asking staff across its roughly 180 hospitals to look for anywhere it might modify to put more patients from storage closets to shuttering buildings. You know, there are lots of things hospitals can do and hospitals will do and hospitals are doing. The first is obvious. Stop elective procedures. Delay non-urgent procedures. Free up as many hospital beds as you can. So, the hysteria and the panic around hospitals I think is to a large extent unjustified because I think hospitals are going to be creative, can be creative if given the freedom to do it. So, infectious disease experts, for example, urge hospitals to separate patients with confirmed coronavirus or suspected coronavirus. So, hospitals are doing this. The Nebraska Medicine, the hospitals and clinics affiliated with the University of Nebraska Medical Center have already set up such a ward, right? Even though I don't think they have any patients yet. And they plan to have another ward like that, which would require hospital staff to relocate pediatric patients and empty space scheduled for renovation. You know, people are creative. They find solutions. But again, we minimize individual creativity. We minimize the human mind. We minimize human ability. We panic. And the sky is falling. Everything is a disaster. So, there's so many things that could be done. Rational things. There's so many things the government could be doing given its heavy role in the economy and in healthcare anyway. And what strikes me as so depressing and unfortunate is we're doing all the wrong things. All the wrong things. And we're panicking. And we're in hysteria. And if you point out that these might be wrong, you're insensitive. You don't care about people. You're whatever. All right. I had a question here. Let me just see. Yeah. Okay. So, I'm going to get the economic stuff. I know Jonathan Honing wants me to talk about the stock market. I will. Let me just see. Okay. I wanted to talk about is this an emergency? I know I'm not sure if it's an emergency. I mean, again, I said this yesterday. You need a whole thinking process to figure out what is an emergency? What counts as an emergency? How you would deal with an emergency? What is the role of government in an emergency? What extra things should it be doing? Is 0.6 death rate an emergency? Is it an emergency? What is if it isn't? Is 0.4? You know, so what constitutes an emergency is an important question that scientists together with philosophers of law should get together and figure out. The role of government, as I said yesterday, is to protect individual rights. And that's it. And that means if somebody is infected, they should be quarantined, particularly if they're going to be exposed to people who might die. So, again, is if they're only affiliated with other people who are young and healthy, does that constitute violation of individual rights? Probably not. But can you limit it that way? These are things that have to be thought through. I don't have the answer. These are things that would have to be thought through. I would say right now, given the government what the government's doing, I'd rather they quarantine people who have been infected than the sweeping regulations that they have right now in the name of an emergency. And look, this is not a war. This is not a war. There's not an enemy out there that needs to be attacked. You think about a war in a very different way than you think about a medical emergency. In a war, individual action is not crucial. Every individual's action is not crucial even to their own safety or life. If we're at war with China and they decide to nuke my city, it doesn't matter what I do. It's not going to affect whether I get nuked or not. I mean, there's so many differences. All right, let me... Okay, so let's talk about what the government is doing. Basically, what governments around the world are saying, with the exception of the UK, which is really, really interesting, is we don't care about the economic costs. We don't care about the jobs destroyed or the jobs lost. We don't care about the wealth destroyed. The wealth lost. We don't care about the economic... And by the way, economic is not just about Wall Street and money, although it's important Wall Street and money, but it's not about just billionaires and, I don't know... Economic means people's livelihood, people's jobs, people's ability to afford groceries, people's ability to pay for that old-age facility for their parents, people's ability to live, to pursue their values, to pursue their happiness. The economy is not over there and our lives over here. The economy is our lives. It is a big, big chunk of our lives and it makes every other aspect of our lives possible. But basically, governments at the local and federal level have basically decided to help with the economy, to help with wealth, to help with jobs. We are willing to sacrifice everything, everything for the sake of slowing down this disease. It is the most important thing. Everything must be subordinated to it. Everything must be sacrificed to it. And that's what you're saying. So to help with the Uber driver, to help with the restaurant owner, to help with the waitress, it doesn't matter. To help with your pension, your 401k, to help with business. It doesn't matter. Everything must be sacrificed for the sake of slowing down, not even eliminating, but slowing down the spread of the virus. Again, I think there are much better ways to slow down the spread of the virus to the people who could be most affected. People are dying. You must all sacrifice your life because people are dying. You must all stop your life because people are dying. You must all stop all activity because people are dying. You can't make that decision for yourself, so we will make it for you. I mean, we live in a semi-police state right now. We live in a state where, you know, I noticed from my condo I can see a beach, right? There's a beach right in front of us. And there were people at the beach this morning. And then they suddenly disappeared. There's nobody at the beach. And then a couple of hours later, I saw a few people at the beach, a few groups swimming at the beach, and then they disappeared. And I realized what was going on. People showing up at the beach, right? They don't have anything else to do because they can't go to work. And the police keep showing up and kicking them out because there's a prohibition of going to the beach. The beaches are closed. There's a prohibition of swimming in the ocean. You can't make those decisions for yourself. I live in Puerto Rico, so there's a beach and you can swim all year round. I mean, it's absurd. We wanted to go in a couple of days and a few days on a boat to one of the islands off the coast of Puerto Rico. Well, no, you can't do that because the business is shut down. It's a non-essential business. And therefore he can't rent the boat to us so that we can go out there. He loses money. We lose the fund. Who wins exactly? It's lose, lose, lose, lose. This was with friends. We're interacting anyway. If one of us gets coronavirus, anyway, because we're hanging out together, we know the risk, we've accepted the risk, we're taking the risk together. Nobody cares. Nobody cares. So what you're seeing is the market respond to this. The market is responding to the callous, irresponsible, valued destruction that the government has initiated. It is truly horrific, as Jonathan points out just stock market-wise. On a percentage basis, today's market drop was the third worst in history, at least on record, behind 1929 and 1987. 1929, which led ultimately because of lots of misuse by government to the Great Depression, 1987 that didn't lead to any particularly disaster, but still managed to wipe out 22% of people's wealth in one day. Worst than 9-11 and worst than Pearl Harbor today, just today. Because that, what constitutes stopping people from working, stopping people from living their lives, stopping people from engaging in activities and pursuit of values, because of a coronavirus. We are inflicting on ourselves something worse than Pearl Harbor on 9-11. It is truly insane, but that's what's happening. So Jonathan is asking, why has the stock market gone down so much? It's gone down so much because it's evident that the US economy is basically shut itself down. It's shutting itself down. Production is shut down. And people are afraid that the shutdown could last much more than a week, much more than two weeks, maybe a month, maybe six weeks, maybe two months. The economy could shrink by 10% over a period like that. What that means for stock prices is dramatic and the stock market reflects that. That's why it's gone down so much, because the actual destruction of productive values that is clear, that is obvious, that is, and the uncertainty, I mean, we could be, you know, some people think that we're the beginning of the end of the world. And some people are pricing that. But there is a massive destruction of productive capacity of, well, not of the capacity, of production, because the capacity will come back. Now, I do think, well, let me not say, I won't say that the market's overreacting, but the market is, I think, pricing some pretty bad case scenarios, which I don't think will come to life. I think that the market probably is going to be significantly higher in a couple of months. I think this is way lower than it should be. I think that because productive capacity is not being destroyed, like in a war where the capacity to produce is destroyed, or where real stuff like a 9-11 was destroyed, all the potential is still there. You get people back to work, a lot of the production comes back. Therefore, the recovery from something like this is far faster than a recovery from Pearl Harbor or anything like that. So I think in that sense, it shouldn't be worse. And markets, particularly in times of extreme uncertainty, particularly in times of massive panic, they overreact the things. I definitely think the market is overreacting. I don't know much about the major market, the S&P, but the markets I invest in, there's a lot of craziness going on that is the result of massive uncertainty and massive fear and lack of information, which is what then suddenly is based off. And the potential, even small, and this is something markets price, and most of us don't in our day-to-day lifetime, but markets price, the potential that this is catastrophic, that it's not just bad, but it's catastrophic. That might just have a small percent, but a small percent of a very big number is a big number and people want out because they're afraid that the catastrophic outcome will happen and that will be wiped out. So willing to get out of the market rather than take that small chance of a catastrophic loss. So I think that's why markets have responded the way they have. It's because of the uncertainty, the risk, the panic, and the probability, even though small, of a huge disruption, huge losses, huge breakdown of society. Imagine a real breakdown of society, riots in the streets, which could happen, right? Really low probability of it, but could happen. Well, that's what the stock market is pricing. All those things over the long run, what impact does it have on this company's ability to produce, on this company's ability to make profits? That's how prices, that's how prices get determined. And it's not surprising they're down to the question of how much are they down. And if you think the market's overreacted, buy. If you think the market is not reacted enough, sell. You know, the nice thing about markets is your judgment is evaluated pretty quickly. Let's see. Yeah, so can you discuss how much this crisis, the government shadow, will impact the market economy and the extra repo and rate cuts by the Fed? So, I had a whole section on this. So one of the, so first let me say, I think there's going to be a real crisis here. There's a real economic crisis. Because government is basically shutting down the economy. What does it mean to shut down the economy? It means to shut down human activity. People going shopping, people going to restaurants, people going to the mall, people buying stuff, people selling stuff, people working, people going to work, people producing. All of that is being shut down. We're supposed to stay home. So that lowers productivity, it lowers consumption, it lowers production, it lowers every component of the GDP of gross domestic product, growth of the size of the economy, size of the economy shrinking and with the stock market collapsing, wealth is being destroyed. Now, so I think we're in an economic crisis. There's no question. We're probably already in a recession. We'll probably get into a deeper recession in the next quarter. I think much of this was avoidable. I think much of this as a consequence of the reaction to the virus, not the virus itself. Now, what about all this extra stuff that the Fed is doing and the bailout that the federal government is going to be? You know, we're going to get a huge stimulus package for the federal government. Democrats and Republicans love this. They're going to spend zillions of dollars stimulating the economy, thus distorting it further. Stimulus is when the government basically borrows money or prints money and then just spends it in the economy. What you get is instead of that money going into production, going into creating jobs, going into producing stuff, it goes into consumption. And it's much less effective at creating economic growth as consumption that it is in production. Ultimately, consumption converts into production, but it's much healthier when the money flows directly into production. Leave it in private hands to make private decisions about private values and how their money should be deployed. Don't give a bunch of bureaucrats to decide which sectors of the economy are best to stimulate because they don't have a clue. Private markets do. So the best thing you can do is get out of the way. No stimulus package. Or if you want to stimulate, the best way to stimulate is cut taxes. But then you should also cut spending. But then there's what the Fed does. And again, this is complicated. It's complicated because the Fed is so involved in our financial markets. The Fed is everywhere. The Fed is manipulating money and interest rates constantly. Oh, Jonathan says cut tariffs. Yes, that should have been done day one. Of course, tariffs should have never been increased. But day one tariffs should have been cut because that will increase the supply chain. That will increase the ability of goods to come into the United States. Tariffs should have been zeroed out on day one of this crisis. Of course, again, they should have been zeroed out long before that. So the Fed is constantly in the market. So you can't say the Fed should do nothing because then why have a Fed? Now, I don't think we should have a Fed. So if you want to argue that we have to do away with the Fed, absolutely. But as long as we have a Fed, it can't not do anything because by its very nature it does stuff. So what the Fed is doing right now is it's basically telling markets we will provide liquidity. We're not going to allow the market and the economy to collapse for lack of liquidity. So I'll give you an example for lack of liquidity. A bank run is a lack of liquidity. So you lend the bank money and it lends it out. You open and counter the bank, put money in the bank, and then the bank turns around and it gives it and it lends it out to somebody. And maybe that loan is doing five years. But let's say there's now a run in the bank and everybody wants their money out. But the loans are going to take five years to get the money back. It's not that the loans are bad. It's not that the loans are going to collapse. It's that the bank just doesn't have the liquidity right now to supply you with the money while it waits for the loans to come back. And deposit insurance, in the case of a simple example I just gave, solves that problem because we're not going to run on the bank because the government's going to supply us with the money if the bank fails. But there are a lot of non-bank entities out there that are borrowing and lending money constantly and that could get into such a liquidity crunch where there's nothing fundamentally wrong with their business but they have a liquidity crunch. And a big reason why they've positioned themselves, they've put themselves in a situation where they have a liquidity problem is because the Fed exists. The Fed encourages businesses to in a sense borrow short-term and lend long-term. And short-term long-term could be an issue of weeks, could be an issue of months, could be an issue of different of years. So what the Fed is doing right now is basically saying we're not going to allow for there to be a liquidity problem. We will make loans to anybody at zero rates basically so that you can fulfill your obligations. You'll have to pay it back to us. So it's not a permanent increase if you will in the money supply. At least not yet. But we will supply that liquidity. Basically what, now in addition to that the Fed is also doing quantitative easing which is increasing the amount of money in the economy under the assumption that credit is going to contract and therefore the amount of money in the economy is going to contract and the Fed is coming in and filling the gaps. Now I know that people are talking about the dollar is about to collapse. What does that look like? Are you not going to want dollars in your pocket? I mean, you can't. If in the United States you're going to use dollars. Why is the dollar collapse vis-a-vis the euro? Really? You think the euro is in better shape than the dollar? You think the dollar is going to collapse vis-a-vis the yuan? Is the yuan really in better shape than the dollar? Now you could say the dollar is going to collapse vis-a-vis gold. But if there are the case gold would be going through the roof. I don't see gold going through the roof. You could say there's going to be inflation. I've heard that before. 2008, I heard it from Peter Schiff sitting in the same studio at Fox Business. He was all about inflation. We're going to have inflation any day now. Gold is going to go through the roof. Never happened. These things are far more complex than you realize. If there's credit contraction then the amount of money in the economy is shrinking. If the Fed is printing money then it might actually sustain the same price level because there's the same amount of money right now because it's filling in the gaps of the credit being contracted. So inflation in the sense of price inflation. Inflation in the sense of gold and the value of gold. It's not obvious at all to me that that is where we're heading. And now ultimately I think we'll get inflation because ultimately with the national debt and everything. But in the short run, in the short run, I just don't see it. I just don't see it. So I think what the Fed is doing is distortive of the economy. I think what the Fed is doing is in a big picture wrong. But in the short run, it's as good as anything else that the Fed is doing, maybe better. It's probably the right thing for the Fed to be doing if there's a Fed. And if it's done what it's done so far. Now I think we're heading towards more stagnation. Not stagnflation but stagnation. I think we're in for long term stagnation. We're in for Japan. By the way, Japan central bank has been printing money like crazy for decades. No inflation. No collapse of the yen. So I just don't see it. So what I think of the extra repo and rate cuts by the Fed. I think the market didn't like the rate cuts. I don't think the rate cuts are necessary. The extra repo, I don't think they have any choice but to do. The quantitative easing, I don't think they have a choice but to do. I think the solution to our problems, you can't eliminate the Fed in the middle of a crisis. The Fed needs to be eliminated when we reach a little bit of stability and then we need to unwind everything the Fed has done. We need to get rid of its setting interest rates. We need to get rid of it, manipulating the repo market and we need to slowly privatize the whole market. But that is not going to be done in a day and it certainly is not going to be done in the midst of a crisis. And in the midst of a crisis, the Fed has no alternative but to get engaged and in this case, getting engaged means provide liquidity. Getting engaged means, you know, print money because it's set up the system. And I know that has bad outcomes but anything the Fed does at this point would be a bad outcome. I think the most important thing that the Fed can do, and this is crucial, I think the most important thing the Fed can do is be very transparent in what it's doing. Be very clear to markets, this is what we're doing and stick to that. So the markets are taken into account what the Fed is doing when pricing assets. All right, quickly a few other questions and then we'll call it a night. When is Alex going to answer climate questions from yesterday? I don't know. I'll try to get him on maybe next week. Maybe now they're all stuck at home. He'll be more available. I'll be doing a lot of shows so we can get Alex to come on and do climate change questions. Another question, what does late-stage capitalism mean? I've been hearing that phrase thrown around a lot later. It's the idea that capitalism evolves in a particularly deterministic path that leads it towards what we have today, which is cronyism and heavily involvement with government, so-called monopolies, billionaires, huge increases in equality. It's kind of a Marxist theory of the inevitable, well, I don't think Marx would buy into it, but it's a post-Marxian theory of the way capitalism would evolve. And so people look around today and they see the state of the world, the world of the economy and they say, this is capitalism, but it's late-stage. It's towards the end. It's about to collapse. It's about to be replaced. So it's very much these neo-Marxists. It's their terminology and everybody's adopted it now. Even Dalio Ray Dalio talks about late-stage capitalism as describing what we have today. They realize it's not quite capitalism in the traditional sense. It's what capitalism inevitably evolves into and it's got to do with Marxist determinism. Things evolve in definite, predictable, unquestioning ways and capitalism has evolved into this crony mess that we have today. Now, of course, there are a million fallacies there. We can talk about those another time. Do you intend to write a book on leadership based on objective principles? Not in my plan right now. But somebody wants to be my co-author, the world opens up, but I don't have a plan right now to do that. I've got material on that. I could probably write something, but I don't have it in the plan and I don't have a co-author. Have you ever been incarcerated? Is there anything or cause you would be willing to go to prison for? No, I've never been incarcerated. I mean, I guess I come close in the military, but no, I've never been incarcerated. Court martial, I guess I mean in front of a court, in front of a judge in the military. Is there cause I'd be willing to... Yeah, of course, there are lots of causes I'd be willing to go to prison for free speech, standing up for free speech, things like that, freedom, generally. But nothing I'm eager to go to be incarcerated for. Of course, I'd rather try everything else before it got to that. So that is very much a last resort. Okay, great. Thanks everybody. I hope you enjoyed this session. I hope you got something out of the early part of it. I'm just trying to get you to think objectively about what's going on out there. And not panic, but not be nonchalant either. This is not a time to be nonchalant. Particularly, again, if you're over 80 or you know people over 80, you care about people over 80 or you have grandparents or parents or whatever. It's not a time to be dismissive. This is not the flu. For if you're over 80, it's far, far more deadly than a few. Oh, a question about bailouts of airlines, cruise ships, hotels. I mean, I'm against bailouts, but if the government shuts down these industries, not and prohibits people from flying, then I don't see how they can't compensate these industries. So it's like if they take over your property by using eminent domain, they have to compensate you for taking over your property. Now, I think the government needs to figure out how to compensate all the businesses they've shut down, all the businesses they've damaged through all the different regulations and they need to find a way to compensate them. Now, how you, you know, it's terrible that we're in a situation where this is happening. But it's government's fault. Now, it's true. Government doesn't have any money. It's all our money, but this is the problem. Somebody says I missed a question. I don't see it. Andy asked, suggesting TV recommendation of people stuck inside. Oh, I don't have anything right now. Next time I'll prepare a list, especially for that. Again, Mr. Sunshine, if you haven't watched it yet, go watch it. But I don't have anything. Whose question did I miss? I'm looking for the question. Sorry, it doesn't let me go all the way to back. Jay, Jay, whatever. Can you just write the question in the chat right now and I'll try to answer it if you're still there? But I will, I will, I will put out, I will put out recommendations of movies and TV stuff and everything like that. DDV show says he's got movie reviews on his channels, but we disagreed on Parasite. DDV show and me, I think. But Whiplash. Whiplash is a good movie. I definitely recommend Whiplash. All right, I don't see the question I missed. Sorry, I apologize. Remind me another time. Man on wire. Man on fire. Man on wire. Man on fire. Right? That's a good movie. I didn't like Man in the High Castle. I started watching. I couldn't finish the first season. All right. All right. Maybe tomorrow we'll do a show about how to occupy. Somebody asked about if I didn't like Parasite, go a man on wire. Oh, it's about the guy who walks on the wire. Okay, and on wire. Jonathan recommends a man on wire. I haven't seen it. All right. I didn't like, I did a whole review of Parasite. Put on your YouTube search, put your run book Parasite. I think I did a really, really good review of Parasite. Why I think it's got an evil theme. It's very well made, but it's got an evil theme, a very well integrated evil theme. But, but, so it's, I think a good movie, but a evil idea. So I did not enjoy it at all. And I, I, I encouraged you to listen to my review that I thought was really good. I actually thought that was a really good review. All right. Thanks everybody. I will see you, I don't know, probably tomorrow. I'll be doing more shows because I've got a curfew. I can't go up. Bye everybody.