Tags: Ebola Outbreak | Brusuelas | Ebola | economy | American

McGladrey's Brusuelas: Ebola Will Not Stall US Economy

By    |   Monday, 27 October 2014 02:09 PM

Ebola has arrived in the nation's financial capital of New York, but the deadly virus is unlikely to derail the economy, according to Joe Brusuelas, chief economist at McGladrey.

"I have never seen a bull market with such a fragile psyche," he told Yahoo. "We're a $17 trillion economy. A few people contracting a terrible disease won't have any impact on our economy,"

So far, only four New Yorkers have been impacted by Ebola: a physician who recently returned from treating Ebola victims in West Africa and is in isolation while being treated for the virus, as well as three people who came in contact with him. Separately, a nurse forcibly quarantined in New Jersey after she came home from treating Ebola patients in West Africa was expected to be released Monday.

Some New Yorkers seem spooked, however, and Brusuelas said there could be impact on the fixed-income markets if investors decide to flee there, but probably little at the end of the day for stocks.

"It will be temporary blips," he predicted.

In Brusuelas' opinion, a larger concern among Americans is how the government will respond to the Ebola scare. "I think what [Americans] are concerned about is that the federal government will effectively manage this."

Yahoo Finance editor Aaron Task said the government's position that Ebola can be contained is reminiscent of former Federal Reserve Chairman Ben Bernanke's comments in early 2007 that the impact of the problems in the subprime market was likely contained. What followed, of course, was the disastrous 2008 financial meltdown.

"Anytime anyone utters the word 'contained,' we are conditioned to think, 'No it's not,'" said Brusuelas.

The global shipping could be disrupted if Ebola begins to spread to more countries, CBS Moneywatch reported.

"The United Nations says about 90 percent of world trade is transported by sea, so just the rumor of Ebola on board a container ship or a freighter can be disruptive," CBS said.

Port entry procedures in some countries, especially in the West African nations hit by the Ebola outbreak, have been tightened.

"Depending on the severity of the outbreak in the coming months, trade from West Africa could be severely affected," said IHS Maritime and Trade analyst Gary Li, in a research note, "especially if other affected countries fall under the chaos of the epidemic."

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Ebola has arrived in the nation's financial capital of New York, but the deadly virus is unlikely to derail the economy, according to Joe Brusuelas, chief economist at McGladrey.
Brusuelas, Ebola, economy, American
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2014-09-27
Monday, 27 October 2014 02:09 PM
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