Bird Flu Investment Perspective
John Markman writes about bird flu from an investor’s perspective on MSN Money.
Markman is not really worried about bird flu. (Never mind that the third of his three scenarios is horrific–he just doesn’t think it will happen). He has interesting advice about companies to invest in if you wish to play the H5N1 odds.
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At the moment, the main thing you have to avoid is chickens that appear to be drowsy, have watery eyes and are stumbling into drugstores asking for Thera-Flu. Just say no. But experts say it’s also just a matter of time until the DNA of the virus slips a gear and changes in a way that makes bird-to-human transmission possible. It’s a sort of a Viral Vegas, where physicians are waiting for Red 17 to hit randomly on the roulette wheel and trigger a payout to the dark forces of the human condition. Alarmists say that in a worst-case scenario, around 2% of the world’s population, or 150 million people, could die of pneumonia, or upper respiratory disease, caused by a H5N1 mutation.
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Still, those jackals in the media and on Wall Street who are specialists at making mountains out of molehills will certainly try to fan the fear of flu at any opportunity. They will tirelessly remind us that there were three pandemics in the 20th century, with the most severe coming in 1918-1919, when 50 million people died, including 625,000 Americans.
The recent lull in really bad H5N1 news is a good time for traders interested in exploiting the pre-pandemic media campaign to take positions in a list of drug companies that have announced products in their pipeline to either provide a vaccine against the new flu strain or treat its effects. Most of the bird flu plays ran up a bunch in the fall and have since traded down to less inflated levels, providing potentially reasonable entries.