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cinghiale

Restaurants in a post-coronavirus world

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The data suggests Spanish Flu was a magnitude worse (i.e. the equivalent of 2 million dead) and the economic impacts barely show up in a Time series.

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How long will it take 

 

There will be a small percentage that will suffer long term ptsd but most people recover in about 3 weeks. 

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An Eater article estimated that 30% of the restaurants in SF could go out of business.

 

 

While is suspect that 30% number is made up, it also seems that the median life expectancy of a restaurant is 4.25 years. I'll let someone better at math than me convert that into an annual rate but my guess is it's 15% normally.

 

Also my favorite fact of the moment is that deaths last week were way down vs the five year average. Mostly from under 30's not getting into accidents but pretty much most cohorts were below normal.

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Restaurateurs make a lot of noise, but once they've laid off nearly all staff, the remaining expenses have them burning through about 2 months of profit for every month of plague, and the coming loans will reduce that further to just over one month per month. It's really no big deal for them. 

yeah,

 

I'm a little biased because my professional life is nearly all ex-US - but you guys are completely missing the huge wall of money + the political and emotional pressure on the banks to let them completely play ball.  Businesses that were going to fall down in 18 months are gonna fall down in 6, but if your business was fundamentally ok going into this you should be fine so long as you are diligent about pursuing the programs available to you.  

 

(the group that might really be screwed - and weep not for them - are the CRE landlords whose mortgages are wrapped up in various structures - like CLO documents never saw a situation in which it might be in the ultimate economic interests of the noteholder to allow forebearance so the servicers evidently can't make it happen)

 

The idea that people won't literally burst out into the streets when this is over seems weird to me.  Like when people said no one would fly again after 9/11. That said be prepared to get your temp taken a lot and probably wear masks in public places.

 

 

I mostly agree, but I do think that this accelerates consolidation. I am also a little skeptical about the efficacy of the implementation of the various programs. And I think they are probably too small and the economics of much larger make a lot of sense, but I am a communist.

 

I think people will burst into the streets - this is a pretty discrete thing - but I also think that there has been a lot of wealth and income destruction and people are overestimating the pent-up demand.

 

AB - it would be great to hear your take on the Euro vs. US approaches. 

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How long will it take

 

 

There will be a small percentage that will suffer long term ptsd but most people recover in about 3 weeks.

Yep.

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Capital Markets wealth effects aside (agreed a big aside) the data I've seen shows a very bimodal distribution. The lower earners are being decimated, while higher earners who are in jobs where you can work from home are improving the balance sheets at an incredible pace. People just aren't spending money. If you've actually managed to bridge the gap (where again I think Europe is doing a better job than here - so far) you won't see permanent impairment to labor, but if we fuck that up it gets ugly.

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It's hard to believe people can't tell the difference between 9/11, 1918 and this - that's just myopic.

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How long will it take 

 

There will be a small percentage that will suffer long term ptsd but most people recover in about 3 weeks. 

 

If you really believe that - there's a bridge I'd like you to buy.

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1918 was worse from an illness perspective, less understood and managed more poorly than this and the ultimate economic impact barely shows up ::shrug::

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By they way these are also the same things that were said to me when in early February I was criticized for saying this would be very serious. And that was based on strong medical information.

 

Fantasy is nice - reality is what gets us through the day.

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1918 was worse from an illness perspective, less understood and managed more poorly than this and the ultimate economic impact barely shows up ::shrug::

...and you of all people should know better than to compare 1918 to 2020.

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How long will it take

 

There will be a small percentage that will suffer long term ptsd but most people recover in about 3 weeks.

Yep.

 

That's just crap and you know it.

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Rich, I don't get it.  YOU'RE the person who posted you were glad you got to a restaurant the last night before the more serious stay-home rules went into effect (when we were still being asked -- but not yet told -- to stay home).  Why will the great mass of people not feel the same way you did yourself, when they're told it's safe enough to go out again?

 

(Indeed, you even said you hoped you'd caught the virus so you could get better and then be immune.)

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As we all know, Rich is close to a lovely person who is a real doc, and probably, from the first minute this shit was being told to the world said, in so many words: "we're fucked."

 

When do the dinners start again - I like the corner seat..;

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By they way these are also the same things that were said to me when in early February I was criticized for saying this would be very serious. And that was based on strong medical information.

 

Fantasy is nice - reality is what gets us through the day.

I'm sitting on huge amounts of food I started stock piling as soon as it broke in Italy. I pulled my kids from school a week before they closed. I'm not minimizing coronavirus at all.

 

I'm just saying human behavior is pretty mean reverting. Now if you want to argue over that's June or August or next January I have no idea

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