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Comment by fulafel | Hacker News Reader

Same as many other problems (eg global warming) - the market economy can't deliver a solution because it's not short teem profitable for the relevant actors.

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It could be priced to be short term profitable, but then the sellers would get accused of price gouging.

And poor countries would get nada.

Not all countries have laws against price gouging (e.g. I am pretty sure it is legal the price gouge the government in my country) and there is still a lack of face masks in those countries.

If manufacturers sold direct-to-consumers, they wouldn't. Problem with price gouging happens because of resellers, and that money does not work as a signal for manufacturers.

The solution for undersupply in times of emergency is, IMO, to ban resale. Some countries, including mine, went that route now.

We are expecting a global economy crisis, much bigger than the last wallstreet crash. There needs to be a solution in the next 6 weeks, not 6 months. Because by then we'll have a bankrun and global shutdown of social behavior.

Profitability needs to look into the next 6 months, not just 2 weeks. And btw, we don't do market economy here anymore. The UK tried and gave up 2 days ago. They are all in centralized crisis mode.

I don't agree here. There's the economy as we know it, which might crash/malfunction but then there is the Real Life™. It might seem that the two are very interconnected and society cannot function without a healthy banking system. Reality however proves different.

Let's take a look at Iran, a country under heavy financial and commercial sanctions (for quite a few years), partially at war, with widespread riots brewing up until just one month ago and with little control over the virus's spread. Life goes on, people still eat, speak to each other and most continue their day to day activities. Same goes for Venezuela or Lebanon.

Sure, some people will need to adjust from selling derivatives to more 'core' activities, but the world will not end. The social system is more resilient than it looks.

EDIT

From a longer-term/big picture point of view, I think it would be healthy to debunk this 'myth' that somehow the world cannot survive a big bank going bust. Let's not mistake preserving status quo for a functioning society as a way going forward.

I feel like you've lost the thread here. Real Life™ is the part of the economy that's being shut down; over a billion people are no longer allowed to go to a cafe or speak to friends or continue their day to day activities. The concern isn't that an extended shutdown will be bad for Goldman Sachs, but that it will make ongoing life intolerable and resuming normal life impossible.

I think everyone agrees (govs included) that this situation is temporary. As soon as the balance inclines the other way as in less damaging overall to actually let the virus spread than current lockdown, the restrictions would be lifted. Why would people not resume life?

We need to get the timing right, how much we can bend the curve without causing more harm. A matter of choosing the lesser evil.

I broadly agree with what you're saying, but I also agree with the original comment that the right timing is necessarily within the next six weeks. So when Cuomo goes up and says "two, three, four months", or when governments impose indefinite stay-at-home orders that need to be specifically revoked, that worries me.

Indeed, I've also seen some scary declarations. I was thinking if it wouldn't have been better to be more upfront about the planning fe.:

Guys, we either let things run as usual and wait for the virus to spread - and it will spread and damage the economy + the health system to an unknown degree - or we do our best for a while to delay things until we get better prepared to handle the ills.

Emphasise on 'our best' because if we don't then the lockdown will be both bad and useless.

We got your back through fiscal stimulus during this time. As soon as we see that the lockdown causes more harm than it solves we will obviously lift it and try other measures.

EDIT

What I meant with Real Life™ is that I believe it cannot be shut down, it can only be changed. Sure, as we speak, people can't have 3$ Starbucks drinks but will still go to the park (groups of 2 max) and have a chat while walking/running.

Some parts of real life are non-negotiable. There will certainly be changes we can and should tolerate. But rules which forbid me from hosting a small dinner party, shopping for non-essentials, or driving down to give my mom a hug are below the minimum requirements of a healthy life and can’t be fully mitigated.

This is incorrect. Someone else in the thread posted the article below. It explained the problem thusly:

1. To make masks, you need a certain fabric

2. The machines to make more of the fabric take 5-6 months to make, and this is a hard limit as they’re quite complex

Basically, all the money in the world likely couldn’t expand capacity of this vital fabric. A Chinese Petroleum company is trying to make new machines quickly, but those in the industry are skeptical.

https://www.npr.org/sections/goatsandsoda/2020/03/16/8149292...

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