The novel Coronavirus-19 is spreading concern worldwide, but for those brave enough to travel during this period, it’s also creating opportunity.
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Coronavirus Spreading
The Novel Coronavirus (henceforth “Coronavirus”) has been well documented (everywhere) so without going into too much detail, symptoms are similar to a cold but it is far more contagious. Those affected fatally tend to include predominantly those with lower immune systems such as the very young or elderly. I’m not a doctor, I didn’t stay at a Holiday Inn last night and I don’t play one on TV.
This isn’t a medical blog so for those interested or concerned, please see other outlets (literally all of them) for more detailed medical coverage.
Coronavirus Contagious to Airlines, Hotels
The disease appears not to be limited to human beings and the stock markets the world over have been rattled into correction territory which will end the longest bull run in modern history if losses extend to 20% of S&P 500 peak. The US Carriers have expanded heavily into Asia in recent years and while they have suspended all flights to China/Hong Kong, the rest of the region is suffering too. Seoul was the latest to see service reductions, now an outbreak in northern Italy has reduced or halted service.
Hotels are feeling the pinch too. Chains globally are shutting their doors until the situation improves as their occupancy rates have fallen to nearly nothing. Rumors on the internet (always to be trusted) said that one Hong Kong hotel was down to single-digit occupancy rates. I would not be surprised if that’s true.
The Brave, Stupid, or Desperate
Some are less worried about Coronavirus, don’t understand the risks fully, or don’t have a choice. Amazon has pulled back all non-essential travel for its employees and it isn’t alone. This corroborates the fear that even domestic travel is starting to become affected.
However, for those who believe that concern is mostly hype, they are reaping the rewards. I have a friend that needed to travel on short notice to Rome this week. I advised him that travel restrictions may hamper his trip and that quarantine may await him upon his return. He was undaunted.
For him, and many like him, he reaps the rewards. He was able to book a return from Europe in business class on almost any day he liked for about $1600-1800. Those rates aren’t incredible, but widespread availability of cheap economy and business class fares on short notice is.
Take the worst possible offender for premium upgrade space and premium awards, American Airlines. Even in the darkest days they have been reticent to release award space. Yet, days from departure to an unaffected zone (Rome) the carrier shows the maximum number of seats available for upgrades or awards. How many diehard American Concierge Key and Executive Platinums have seen 7+ eVIP (systemwide upgrades) available for spring to Europe?
Conclusion
For those who have to fly, want to fly, or don’t see the potential risk as real – they will reap the rewards from empty airports and empty planes. I have been tempted myself to consider such travel due to low prices and the guarantee of clearing an upgrade but I have to ask myself, is that just a different kind of affliction or genuine opportunity?
What do you think? Is coronavirus overblown? Is there real opportunity for travelers or is this a case of the foolhardy running into real danger?
The wife is currently in Frankfurt and the hotel manager just told her that she is 1 of 4 people in the 50 room hotel. Also told her that 80% of their upcoming reservations have cancelled.
The deals are still not that great. The availability is higher but the prices aren’t screaming bargains. If you know of any pot them in the blog.
I am looking forward to when people jump out from their windows on wallstreet. Fortunately or unfortunately that doesn’t seem to happen in recessions nowadays.
I hope the capitalists will take it like men, but i doubt it. Most of them become socialists and want a handout/ bailout when it’s their time. You can never rely on capitalists to stay capitalists at all times but you can rely on a republican to have a face you want to punch at all times.
Lot a love in your heart. Life’s great isn’t it.
I would love to use this time to get some cheap business class mileage runs but my wife said if I go anywhere I have to quarantine myself when I get back. So the cost for 2 weeks of hotels kind of kills the deals.
I canceled a week long trip to London that was scheduled for later in March, coincidentally, the number of Coronavirus cases in the UK doubled overnight. The reason I cancelled was that it was a purely leisure trip (I was also going to spend each night in a West end theater) and completely non-esssential and refundable, less the theater tickets. I will continue to monitor the situation and may have to cancel another European trip in early April that will be potentially more expensive to do.
Hal, that is something I have also thought about is that if you are willing to take the risk, upon your return you may also be putting loved ones at risk if you return home with Coronavirus that is either not symptomatic or in the early stages.
I intend to continue to travel unless I know that I have caught it – my only upcoming travel in the next two months is between the UK and the US, both countries that already have cases and hence are certain for the virus to go around them anyway.
The slight increase of health risk caused by Covid-19 to someone of my younger age and generally sound health does not outweigh the benefits of travel.
The only reason I would seriously consider not travelling out is if it appeared that either of the US or UK governments were on the edge of declaring martial law and vastly restricting travel whilst I was away from home; but even then, with the number of Brits in the US at any one time (and vv) there would likely be arrangements made to repriate.
My greatest concern is not as much getting the virus but rather getting it while traveling and being forced to quarantine in a foreign country with little access to support from family/friends if needed. The cruise ship passengers, while an extreme example, were put through hell and I can’t imagine being in, say, Vienna…contracting it…and being sent alone to an Austrian facility for weeks on end for treatment and isolation. I want to be home if it happens.
Wow, not real concerned with other people’s health. You can have the virus, be non-symptomatic, and pass the virus to others. This column is irresponsible until we know more about the spread.
I think that it could be foolish. Even setting aside the risk of the virus and the risk of quarantine, there’s the additional risk that your reason for travel could shut down. Closed museums and cancelled events. Less crowded places may be more enjoyable, but cities with people going out only for necessities, with restaurants closed and tours unavailable doesn’t sound like my idea of a fun trip.
I’m still planning trips. But I’m hesitant about actually booking, and I’ll definitely making sure that everything is cancellable.
While I’m not sure about the foolish part, you make a good point about closed museums. The Louvre is closed so that would take some of the fun out of visiting Paris, and I’m sure you’re right about restaurants and tours as well. I’m too stubborn to let fear dictate whether to make or cancel vacation plans, but your overall perspective seems awfully sensible.
As a Roman, I can tell you that Rome is Covid19-free and since it’s so reliant on tourism and business travelers, the local economy desperately needs the cash influx from foreign visitors…
Virus free, according to officials. Who knows how true that is.
It isnt virus free. I just read today that there are cases in Rome.
Correct at time of posting. The situation evolves by the hour.
I think the down town your seeing in travel is only beginning. I mentioned it before on another blog but I think we might see a lot more availability in coming months. I’m wondering if it will rival post 9/11 or post 08 financial crisis down turn level.
100% agreed. Whether the issue is real or imagined the effect is the same.
“The disease appears not to be limited to human beings and the stock markets the world over have been rattled into correction territory ending the longest bull run in modern history.”
So I’m going way into the weeds here, but this statement is technically inaccurate. The bull market doesn’t officially end until the S&P 500 drops 20% from its all time high, which officially puts us into a bear market. That may well occur next week, but it hasn’t yet,
Anyway, I mentioned this on Matt’s earlier post, but I think it bears repeating. If you have to go somewhere, you have to go, but for purely frivolous travel, you’re playing with fire. Speaking for myself, getting stuck in a quarantine somewhere overseas for weeks isn’t an option, with a wife and small child at home. For that matter, our county health department is already ordering two week self-quarantine with mandated daily reporting of health status if you travel from a restricted area, and the definition of “restricted area” is likely to change daily over the next several weeks. I can’t afford two weeks off from work involuntarily after already taking time off for vacation, and don’t really have the option of working from home. (I’m guessing the owner of my company won’t be amused, either.) It’s simply not a risk I can take right now, so while I do agree much of the hype is overdone, it’s also not a risk I’m willing to take right now – because I can’t control the authorities from overreacting.
Text me this week if it stays above 20% and I will update the post but I doubt it does.
You should update it now. You stated something which is currently incorrect. Whether it changes tomorrow or next year is not relevant; you are CURRENTLY wrong. You get that, right? Also, there is no such thing as, “coronavirus-19”. I know you don’t like to google facts but don’t be ignorant about something as serious as this.
Aztec, always good to hear from you. According to Investor’s Business Daily (linked in the post):
“Stock Market Correction Underway
The Dow Jones, S&P 500 and Nasdaq composite suffered their worst weekly losses in years as a coronavirus stock market correction took hold, even after slashing Friday intraday losses. Microsoft (MSFT), Mastercard (MA) and PayPal (PYPL) warned on the virus’ impact.”
What Meanmeosh said was that a bear market occurs when stocks are down 20% from their peak, but a correction starts at 10% so what I typed was not inaccurate because a market correction (if the peak does not resume) does end a bull run without entering bear territory. As a courtesy to my friend Meanmeosh, I offered to change it if the market hits bear territory which I am sure it will. (https://www.schwab.com/resource-center/insights/content/market-correction-what-does-it-mean)
Further, I corrected the mix-up between “COVID-19” and “Coronavirus Disease of 2019” which are literally the same thing when I incorrectly combined them into “Coronavirus-19.” I also gave the clear indication that I didn’t stay in a Holiday Inn Express last night though perhaps you did.
I’m accepting your apologies right here… whenever.
A market correction absolutely does not end a bull market… This is the seventh one during this bull market. Correct the post already.
Corrected. Let’s see how long before no correction was needed at all…
Sigh…corrections do not end bull markets. And seeing as how you’re too lazy to google it, this particular coronavirus (they’re are others) causes covid-19. This coronavirus is the virus and covid-19 is the disease; they are NOT “literally the same thing”.
Please, google your “facts” – it’s “literally” free.
Just so you know, it may seem like I give you a hard time occasionally but I respect that you take the time to respond to comments and I readily admit that I read your posts every Sunday. Kudos.
Many airlines are making the assumption that those still flying have no choice but to do so; consequently some routes show no reduction in fares at all, and some are very high.
But in Asia it’s largely a question of looking at positioning flights to cities with better fares. And there are many very cheap deals, both Y and J. I’m booking J in order to provide the greatest flexibility in the event things go south in respect of the virus situation.
I was surprised by some routes and the reductions in service will certainly limit some of the fire sale pricing I’d normally expect, but they will only park so many planes before determining that prices have to come down further.
Indeed. But my point of reference is Thai; while I’ve pretty much given up on them for various reasons, I thought I’d look at a few routes to see if they’re joining in the discounts. Sure enough: NO, fares have gone up leaving them double the competition ( at least my routes/dates). When the going gets tough…put the price up. It’s a uniquely Thai thing, in a whole range of goods and services.
There is no such thing as, “coronavirus-19”. There is something called, “covid-19”. These are not the same thing.
Kyle- I enjoy your writing, insights, and the openness with which you share your family’s adventures- its refreshing in so many ways. Nevertheless, I think your market analysis here with regards to U.S. equity markets is flawed and doubling down on your assumption of a Bear Market is reckless. In no way does a correction indicate the end of a Bull Market, in fact, it supports the presumption that the market was overbought and the sell pressure had built beneath the surface to a point where some factor pushed markets down to balance the trend-line and return the market growth curve to a healthy mean. I take great exception when anyone speculates and presents it as fact- which I think in some ways your assumption of forthcoming bear market does. The fundamentals of the U.S. economy are strong and well-positioned to withstand the headwinds in front of it, better so than Europe, China, or other Asian Markets, which could in turn lead to liquidity making its way to U.S. equities. Also, certainly not trying to troll you like Aztec or Debit- its just my own perspective and that market speculation fuels further speculation and fear- especially when based upon little more than evolving data. Anyways- grabbed an amazing redemption out of BOS-ICN-KIX-BOS for August in Prestige (Korean) and Suites (Delta)…. Hoping we can fly it! As a note to Aztec and Debit, stop being such a dick- no one likes the person who send grammar and meaningless commentary about what the nomenclature of Coronavirus or other things. You are a tool and are definitely the kind of person who wears a t-shit to a pool party
“I didn’t stay at a Holiday Inn last night and I don’t play one on TV”
I’m not American, so I assume there’s a joke here I’m not aware of.
There was an ad campaign for Holiday Inn Express here in the US several years ago where you’d have some guy acting like a doctor/lawyer/wildlife expert/etc. Then someone asks him if he actually is [enter profession here], and he’d respond “No, but I did stay at a Holiday Inn Express last night.” They actually were pretty funny. I’m sure you could find them on YouTube if you’re curious to see them.
Google cancelled the “physical” Google I/O in May.
https://9to5google.com/2020/03/03/google-io-2020-coronavirus/