The Stock Market Impact of an Avian Flu Pandemic

aFluPandemic.com is an excellent resource for information about Avian Flu, including links to most of the official government papers about the topic. Among the information on the site is An Investor's Guide to Avian Flu. Among the predictions, it says that economic activity in China and India will grind to a halt. Here's the full post:

BMO Nesbitt Burns, a Canadian brokerage, has published an Investor's Guide to Avian Flu.

The guide, which hums and haws a bit in embarrassment at the idea of telling people how to make money from a pandemic that could kill millions of people, ends up with some specific investing recommendations.

The brokerage predicts:

• Stock markets will close when a pandemic is declared, starting in Asia
• Travel, tourism, hospitality and insurance will be hammered
• Commodity prices will collapse as economic activity grinds to a halt in China and India
• Realeestate markets will collapse
• There will be a temporary flight to gold and US Treasuries

And it recommends investors prepare by putting their money in:

• Cash
• Put options on volatile stocks
• High quality bonds
• 'High quality dividend paying stocks of companies with minimal exposure to risks'

The good news?
Immediately after the pandemic is over, there will be a boom. The people who will get rich will be those who have cash to buy bargain-basement real estate.

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