#90: The Price Of Uncertainty — Chris Joye

Chris Joye is Founder and Co-Chief Investments Officer at Coolabah Capital Investments. He is also a Contributing Editor with The Australian Financial Review.

Show notes

Selected links

  • Follow Chris: Website | Twitter
  • ‘The RBA’s job is to back banks, not to bail out gamblers’, AFR article by Stephen Grenville
  • ‘Why a cash-splash can’t save us from the virus crisis’, The Sydney Morning Herald article by Andrew Charlton
  • ‘Peak Virus: Forecasting the Peak in COVID-19 Infections in the US and Australia’, research article by Chris Joye

Topics discussed

  • Did Chris foresee the pandemic? 5:08
  • Why were investors so slow to react to the pandemic? 9:01
  • Where did the novel coronavirus originate? 15:22
  • The probability of an early vaccine. 22:04
  • What are the domestic consequences of the coronavirus for Xi Jinping? 22:49
  • Potential antiviral treatments for COVID-19. 28:02

One Comment

Les McFarland
April 2, 2020 4:46 am

A timely interview and always interesting to hear Chris Joye’s thoughts. So Chris was ringing an alarm bell back in late January. Good on you Chris. But, on the whole, the Covid-19 experience reveals once again that the profession of economics was looking the other way while we were collectively run over by a bus – as per the previous experience of the GFC. Financial market reactions and over-reactions are interesting but not critical (well apart from losing my shirt). And of course we can’t expect economists to predict Covid-19 in particular. But I charge the economics profession with woeful unpreparedness to face a global pandemic – an event that has happened before, and was a complete certainty to happen again. Where were the economists who war-gamed this and were warning governments for years about the global supply chain risks in the health system? Where were the plans to “hibernate” certain industries and resurrect them when the all-clear was given, anticipating the most obvious second and third order effects? Every situation is going to have its peculiarities, but why wasn’t there a play-book to work from which would be giving us some clarity about the policy framework which we will have to work with (and therefore facilitate efficient markets)? Chris says the market can’t price this risk. I disagree. It can’t price risk in this situation simply because we are lacking any predictable policy framework apart from band-aid measures of demand stimulus and liquidity guarantees – band-aids which now appear to be semi-permanent. As a profession, economics needs to reflect on this and step up to the job of global risk management.

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