Monday, April 27, 2009

Swine Flu Problem and the Economy

Research indicates that the swine flu issue might be a major hit on the economy. Capital Economics recently did an economic analysis of the SARS crisis of 2003. They concluded that that event resulted in a loss of between 0.6% and 2.0% of regional GDP in Asia. These are highly trade dependent countries and SARs hit international travel and trade hard. The impact might be less here but it depends on how widespread the disease becomes. At any rate, we might need to readjust our state economic forecast downward even more.

A swine flu pandemic in a deep recession could make the term perfect storm trivial.

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