My project is to create an "alarm bell" questionnaire to help coordinate an earlier response to the next pandemic. Please see the original document for a fuller explanation. In brief, if 13 of the 16 criteria below are met after a disease makes front-page news, this questionnaire anticipates that we should see a major stock market crash due to the disease. The goal, though, is not precisely to predict that crash. It's to stimulate discussion so that we don't behave complacently and have some intellectual tracks laid for assessing the new situation.
I am testing it by seeing whether it would have rung, and whether it should have, during a set of historical epidemics and pandemics. My first test on 2009 swine flu was as success, as was this second test on the Ebola outbreak of 2014-2016.
Once again, the initial questionnaire performed correctly. The alarm bell should not have rung for Ebola, and indeed it didn't ring.
Three criteria received a "no" throughout the epidemic. It's not airborn and there's no asymptomatic transmission. It also never made it to a significant number of large, industrialized nations. That puts it on the borderline.
Prior to September or later, the death toll was below the threshold, and it hadn't yet reached major cities with strong international travel links or led to major economies restricting travel.
In September, better estimates for overall transmissibility made it no longer comparable with COVID-19. The same month, the first treatment became available.
Those shifting and coinciding trends mean that there was no month where at least 13/16 criteria were met simultaneously.
My explanation for why Ebola did not crash the stock market is that it's a disease with a terrifying case fatality rate, but a transmissibility rate too low to make it a world-shaker. Most of its fatalities were in nations without much economic clout. It's relatively easy for a well-equipped nation to prevent its spread. The disease is horrible for the affected nations. I think it was probably neglected due to being an African illness, and I'm glad that at least we've produced both a treatment and a vaccine for it now.
Below is my analysis for the questionnaire and the stock market.
Stock market trends in 2014
October 2014 market the peak of the Ebola epidemic, although that's in hindsight. Here's what the market looked like that year, with mid-October market in red.
Three factors may suggest whether a stock market decline is disease-linked.
1) It should coincide with significant, ideally pre-registered important moments for the disease, such as peak spread/mortality, or reaching major economies.
Mid-October is in the neighborhood of the Ebola epidemic's peak, and its introduction to America. I didn't pre-register these criteria, but they seem significant. We'll see whether the disease met the criteria from the questionnaire around that time.
2) Contemporary sources should attribute it to the disease with confidence.
This NYT article from Oct. 16th attributes the dip to a variety of factors including Ebola, but points out that "nobody is entirely sure why the sell-off is so sharp." Here's another from that period that rambles about Ebola a bit along with other factors to explain the dip. This article chalks up the sell-off to many factors, including but not limited to the virus.
3) In retrospect, the crash should not look like a random walk.
At the bottom of the marked trough, the New York Times was speculating about the beginning of a bear market. In hindsight, it looks to me like a random walk.
Comparison with Coronavirus crash
For comparison with the Coronavirus crash, here's 40 years of stock market data for the S&P 500:
Part of the point of the questionnaire is that it gives a benchmark for what we knew about the disease prior to the stock market crash. The purpose of this analysis is to compare it to Ebola and see which should have appeared worse at the time.
Here's a selection of articles from the NY Times explaining the stock market from the week of Feb. 20th to Feb. 27th, 2020.
Feb 20th: Why the Stock Market Isn’t Too Worried About Coronavirus (whoopsie!)
Feb 26th: Stocks Fall Again as Coronavirus Spreads
All of these articles clearly, confidently attribute the stock market decline to Coronavirus.
The recent crash is clearly visible, on par with the 2008 recession. It's one of the three most obvious drops on the whole chart. By contrast, the 2014 mid-October drop is marked by the dotted line, and it's just fuzz.
It's clear to me that Ebola did not cause a stock market crash on par with COVID-19, and thus it should not have rung the alarm bell. If the questionnaire is correctly calibrated, Ebola will not meet 13 of 16 criteria simultaneously.
Factor 1: Transmissibility
- Does the disease appear to spread from human to human?
- Does the disease spread via indirect contact (coughing, sneezing)?
No. According to the WHO, the closest it comes is indirect transmission through surfaces. This isn't what was meant by the original question, as demonstrated by the example "coughing, sneezing."
- Is there any evidence that the disease is transmissible before or just after the start of symptoms?
- Do any academic papers, especially in the Lancet or the New England Journal of Medicine, suggest the possibility of "risk of much wider spread," "exponential growth," or use similar phrases? Try searching "[DISEASE NAME] exponential growth" on Google Scholar.
Another way to answer this is by comparing R0 for COVID-19 and Ebola. COVID-19's R0 is estimated around 1.5-3.5. According to a mid-September 2014 analysis, articles from 2005-2007 had estimated an R0 for Ebola of 1.34-3.65. An R0 greater than 1 implies the potential for pandemic-level spread, and this article questioned why this hadn't occurred. The article estimated an R0 of 0.94.
This adds nuance to the criteria. For known diseases, should we use the actual fact of whether it's caused pandemics in the past, warnings from scientists, or recent R0 values? For this analysis, I will say that prior to mid-September, this criteria was met as a 1.34-3.65 R0 is in the neighborhood of COVID-19 estimates. After that point, the criteria was no longer met.
Factor 2: Harm
- Is there evidence that the disease has a 3% or higher mortality rate among those 60 (or even younger), or 1%+ mortality among those 50 (or younger)?
- Can the disease last for two weeks in more serious cases?
- Do around 5% of patients seem to require hospitalization?
Not sure about this source, but there appear to be mild cases of Ebola. This is not a contemporary source, but it estimates that 60% of Ebola cases seek hospitalization. Until I can find a good, contemporary source giving 2014 hospitalization-seeking rates, I'm going to tentatively declare this a yes.
- Are there no vaccines or treatments that have been proven effective?
The Ebola vaccine was not approved until 2019. The first treatment for Ebola (serum from convalescent patients) was approved in early September 2014. Because this question is intended to receive a "no" if there is neither a vaccine nor a treatment, it receives a "yes" prior to September 2014 and a "no" after that time.
Factor 3: Spread
- Is the world death toll over 2,000?
Yes. According to archival WHO situation reports, Ebola crossed this threshold around September 6th.
- Has the disease been detected in at least 10 industrialized countries collectively containing a total of at least 1 billion people, found in people with no clear link to the original source?
No. The disease never spread to 10 industrialized countries, and the 10 it did spread to had less than a total of 1 billion people.
- Is the disease present in major cities with strong international travel links?
Yes. The clearest example I can find is that one infection was discovered in Dallas, Texas on the 20th of September. I'll declare this criteria met from that date onward, and may revise to earlier if other clear examples can be found. I may consider revising this to "achieved community spread in major cities with strong international travel links" in a future version of the questionnaire.
- Has the disease spread in advance of a lockdown, or escaped it?
Factor 4: Institutional response
- Has a city-wide lockdown been attempted in a city of a population of at least 10 million, or have travel restrictions to or from major economies been implemented?
Yes. The USA is a major economy (21% of world GDP, over the 2% threshold I established in my swine flu post). It required travel from affected nations to pass through airports with screening procedures on October 21st, 2014.
- Has the WHO or a similar organization declared an "emergency of international concern" or "global emergency," or issued an even more severe warning?
Yes. The outbreak was declared as such by the WHO on the 9th of August 2014.
- Have there been several front-page news stories about the disease?
Yes, there were multiple A1 articles in the New York Times by early summer 2014.
- Are there reports or warnings of shortages of medical supplies from the most-affected regions?
Yes, the most-affected nations were poor African countries with shortages of just about everything.