Are societies more prone to panic than ever before?
In the 14th century, the Black Death killed 30-60% of Europe's population in a four-year period and reduced the world population to 350 million from 450 million. Most victims died 2-7 days after the initial infection and survival rates were remote.
It's still not clear how it spread.
One hundred years ago, the Spanish flu was in the course of infecting 500 million people and killed 3-5% of the world's population with those aged 20-40 most vulnerable.
It's still not clear where it originated.
Public health officials agree that another pandemic is inevitable. With better medicine, hygiene and facilities most agree that it will be less deadly.
Yet while people in 1347 and 1918 continued about their business, societies now may be more fragile. Our interconnectedness shows us that things elsewhere are better and generations accustomed to instant gratification demand action. The panicked response may prove to be worse than the disease. It's rarely the fire at the disco that kills you; it's the stampede.
Some interesting reading comes from an interview with Martin Rees, who is Britain's astronomer royal and a professor at Cambridge University. in his book, Our Final Hour, he gave civilization a 50-50 chance of surviving this century.
"I think if we had some sort of pandemic today, and once it got beyond the capacity of hospitals to cope with all the cases, then I think there would be catastrophic social disruption long before the number of cases reached 1 percent. The panic, in other words, would spread instantly and be impossible to contain," Rees says.
Even a computer virus could have some of the same effects, with people quickly growing incensed in ways we haven't seen before.
It's something worth pondering. If you agree that we're more vulnerable to panic -- and the market response to 10% declines suggests we certainly are -- then that will at some point mean that markets have fallen too far. The trick will be waiting long enough to dive in.
