A new strain of flu has spread from Mexico to the United States, and the U.S. Centers for Disease Control and Prevention as well as the World Health Organization have issued statements indicating that they are very concerned about the possible spread of the virus.
The U.S. Centers for Disease Control and Prevention (CDC) announced April 25 that the so-called "swine flu" that has spread from its apparent origin in Mexico to the United States cannot be contained. Similarly, the World Health Organization (WHO) has indicated the new strain of flu has the potential to become a pandemic, although the organization did not raise its pandemic alert level. The situation is developing extremely rapidly, and information is limited. STRATFOR is watching the issue closely, and will await further news from health officials monitoring the outbreak at the CDC. According to preliminary test results from the CDC, the swine flu appears to be a combination of bird, swine and human flu strains from all around the world. The virus appears to cause slightly higher-than-normal levels of diarrhea and vomiting, and can develop into an acute respiratory infection after about five days of sickness. Infected persons have included healthy adults between 25 and 44 years old — so those afflicted are not just the old, very young and already sick. The virus appears to be responding to Tamiflu, particularly when caught at an early stage. Tamiflu manufacturer Roche has indicated that it is prepared to release stockpiles of the drug. Mexico reportedly has only 1 million doses of the drug stockpiled, and is only distributing the drug through doctors. This could hamper the country's ability to halt the spread of the disease in Mexico City, which has a population of just under 9 million people. Many of the details on the spread of this flu are unclear because the tests used to confirm the presence of this strain take several days. However, so far there might be as many as 68 deaths and up to 1,000 possible infections in Mexico, mostly in Mexico City. There have been no deaths in the United States; however, there have been a number of confirmed cases of swine flu in San Diego, Kansas and San Antonio. There is a cluster of 75 flu cases at a high school in New York City, eight of which have been confirmed as probable cases of swine flu. The CDC's statement that the swine flu is unable to be contained is not as dire as it may sound, and essentially reflects the reality of the rapid and wide distribution of the swine flu thus far. True containment is possible only when exposed individuals or communities can be effectively isolated. With the extremely high rate of people and goods moving by plane, car, boat and foot across the U.S.-Mexican border, the two countries are highly interconnected. Once the swine flu is inside the United States and located in major metropolitan areas, the capacity to isolate individuals is even smaller. This is not to say that there are no precautions that can be taken. Government officials in the United States and Mexico have announced school closures and advised individuals to avoid crowded areas. In response to the spread of the disease, Mexican President Felipe Calderon has declared a state of emergency, giving him broad powers to cancel public events. Basic precautionary measures such as frequent hand washing and avoiding contact with infected persons are also being promoted. The CDC is publishing its own findings on the new strain of flu (updated information can be found at http://www.cdc.gov/flu/swine/). At this point, the information is too limited to make any real predictions about the possible impact of the disease. STRATFOR is taking this seriously and is awaiting the results from the CDC's ongoing study. In the event of too little information or bad news from the CDC's analysis, it is possible that the financial markets could react very poorly come Monday, April 27. However, the situation is developing extremely rapidly, and the CDC may be able to present more concrete findings before the weekend is through.