Coranavirus is generating massive uncertainty and alarm.
Investors are disorientated. They know this is serious, they don’t know how serious. If in doubt, sell shares, buy government bonds and buy gold - a perceived safe haven at times of crisis.
And this is starting to feel like a crisis. The FTSE 100 in London closed down 7.6% - we haven’t seen a fall like that since the dark days of 2008 when the financial system hurtled toward bankruptcy, threatening to take the economy with it.
The biggest fallers were the oil, energy and mining companies but the sell-off was widespread.
Ninety-nine of the 100 companies that make up the FTSE 100 saw their share price fall.
If you look back over the last two weeks and you can see that holiday companies (like Carnival and TUI), airlines (like EasyJet) and banks (like Barclays) are at the sharp end of this.
The great anxiety here is that the spread of the virus and the measures being used to contain it may tip economies into recession.
Travel bans, business closures and quarantines can bring activity to a halt.
Investors worry that we could quickly get into a position where otherwise healthy, viable companies fail because they run out of cash.
If restrictions of the sort we’ve seen in Italy end up being introduced here then an unknowable number of workers will find themselves quarantined at home and an unknowable number of business will close. That’s an economic shock of unknowable scale.
Tonight, the Institute of Directors said that one in five of its members see coronavirus as a high or severe existential risk
There’s a weight of expectation building on Wednesday’s Budget. The government and the Bank of England are under pressure to do something substantial: tax holidays for businesses, underwrite loans from banks.
Statements like “we stand ready to do everything necessary” won’t cut it any more. The time for action is now.