In mid-February, one of the longest bull runs in history was marching steadily onward, more than a decade after it began. Major equity indices in New Zealand, Australia and United States were at giddy heights. It was on a Monday that the tide suddenly started retreating, ahead of the Covid-19 tsunami which is breaking across the world.
Monday, March 9 NZT
The day begins with news that Italy has placed 16 million citizens in the northern region of Lombardy in lockdown in an effort to contain the worst of its Covid-19 outbreak. Russia and Saudi Arabia then fire the opening salvo in an oil-price war that will later see Brent crude oil prices drop to their lowest in 18 years. These twin harbingers are a potent blend.
The Dow Jones Industrial Average had held steady to close the previous week, but global worries see the NZX50 slide by 3 per cent and the ASX200 dive more than 7 per cent. Much worse is to come.
Tuesday, March 10 NZT
Overnight Italy, the third-largest economy in the eurozone, expands its quarantine nationwide after earlier restrictions failed to slow the virus' spread.
The Dow takes a sharp slide as fear takes hold, losing 8 per cent per cent during the day's trading. This crash is the largest since the depths of the global financial crisis in 2008. But this silver medal would be barely minted before being shunted off the podium as it is overtaken - twice - in the week to come.
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The plunge in the United States is followed by the most volatile day on the Australian market in more than two decades - losing almost 4 per cent shortly after opening, but somehow ending 3 per cent up. At home, the NZX50, perhaps noting that the five confirmed cases of Covid-19 here have not increased for a week, dips by only 2 per cent. But this cautious optimism cannot hold.
Wednesday, March 11 NZT
The Dow swings wildly again, gaining 5 per cent, while the NZX slides a fraction of a per cent and the ASX200 ends the day down nearly 4 per cent.
Waikato University economic historian Les Oxley says he began to sense something historic was occurring when exchanges around the world repeatedly began engaging trading halts in response to a sharp rise in volatility.
"We now have the markets being closed on an almost regular, if not day-to-day, basis," he says.
"In the early rounds of falls in the market, a lot of commentators were simply saying 'This is quite common, there'll be a bounce back. So don't panic about your portfolio.' But what we're seeing now is double, triple, quadruple dips and I bet they are now wishing they had said something different."
Oxley says he moved himself in response, but the speed of the crash meant that even a scholar of economic crises was off the pace in liquidating assets.
"I responded probably earlier than most, but certainly not early enough."
Thursday, March 12 NZT
Overnight, the World Health Organisation officially declares Covid-19 a pandemic. United States President Donald Trump, who previously described the virus on Twitter as a hoax, or downplayed it as "just the flu", follows by reversing course and, in a prime-time TV address after US markets close with the Dow down by almost another 6 per cent, declares he will combat it with a unilateral ban on travel between the US and Europe.
The news spooks local markets: the NZX50 down 5 per cent, the ASX200 more than 7 per cent.
Craigs Investment Partners' Mark Lister says the implications of the rapidly worsening situation in Italy - with the country in lockdown and the health system overwhelmed - were now starting to bed in and the brakes seemed to be coming off.
"It was becoming pretty clear at this point this could get ugly."
Friday, March 13 NZT
And ugly it gets, with New Zealand awakening to news that the Dow has crashed by nearly 10 per cent, and that Canadian Prime Minister Justin Trudeau is entering self-isolation after his wife tests positive for Covid-19.
The Australasian markets gyrate wildly, with the NZX50 closing down nearly 5 per cent and the ASX50 recovering two-thirds of the previous day's historic losses to close more than 4 per cent up.
Over the weekend, dramatic developments continued to accelerate. In the United States, Trump announces a US$1.5 trillion stimulus package, sending the Dow soaring more than 9 per cent as New Zealand starts its Saturday.
Castle Point Funds co-founder Stephen Bennie says he wasn't convinced this newfound optimism could last, and developments later in the week confirm that a fully-fledged crash is in train.
"It was just hidden a little bit by that muppet rally," he says.
In Wellington, fears crystallise as policy: Prime Minister Jacinda Ardern cancels a hugely significant mass gathering to commemorate the victims of the Christchurch mosque shootings a year earlier, and announces sweeping travel restrictions requiring all arrivals to self-isolate for 14 days. Within less than a week this will harden - as it does in many other countries - into unprecedented border closures, effectively shutting down the entire tourism industry.
Lister say it was now - following Ardern's dramatic announcements - that for him the penny dropped that this was no mere short-term turbulence that could be quickly ridden out.
"It's right on top of you then," he says.
"And it's almost to late to react."
Monday, March 16 NZT
A wave of profit downgrades sweeps the NZX as the implications of the worsening crisis set in. Tourism and travel companies, and SkyTV - its sports content rapidly turning into dead air as competitions cancel across the globe - are hit especially hard.
The Reserve Bank cuts interest rates to the bone, chopping 75 basis points off the official cash rate, leaving it at just a quarter of a per cent. The move softens the slide on the NZX50, but it ends the day down 3.5 per cent. In Australia, it's a wipeout, with a 9.7 per cent crash - the biggest single-day slump since 1987.
Prime Minister Ardern bans gatherings of more than 500 people (later in the week the cap will shrink to 100) and warns of the possibility of a recession deeper than the one that followed the GFC.
Tuesday, March 17 NZT
Overnight, the US markets open for the first time since the weekend to carnage exceeding even the decades-worst levels of the previous week. The Volatility Index, a measure of investor fear, reaches uncharted levels when it exceeds the previous high notched up in 2008 during the peak panic of the GFC. The Dow tanks nearly 13 per cent.
Lister digests the news on waking and surveys the damage: "Nights like last night, you do feel there's blood on the streets. There are waves of panic and fear, washing through. It's wild. Just absolutely, spectacularly, wild. There have been some days when you feel like there might have been genuine panic.
"Sharemarkets look ahead, and I think the dramatic fall has been the sharemarket factoring in dramatically changing information. At this point it's 'Jeez, we have no clue how bad this will be'," he says.
The New Zealand Government announces a $12.1 billion stimulus package. The NZX50 still ends the day down, albeit only 0.5 per cent. Governments around the world try variations of the same trick.
Bennie says it seems these moves aren't working and around the world they have failed to arrest the crash. "It's a band-aid on a gunshot wound. It doesn't really help. You need surgery to sort that problem out."
Wednesday, March 18 NZT
Volatile trading continues, even accelerating. Locally, the Government announces it will deport foreign tourists who flout self-isolation requirements - full border closures will be announced 24 hours later. And the long-gestating blockbuster Avatar film series suspends production.
The Dow is up 5 per cent. The ASX200 down more than 6. The NZX50 surges for a time to briefly flirt with a 5 per cent rise, but by the close of trading has shed almost all its gains.
Economic historian Oxley says the parallels now are beyond living memory - either the Great Depression or the aftermath of the 1918 Spanish Flu, but both of these events are an imperfect match for what the world is going through: "It's very different, but not unique," he says.
"We're probably going to see a period of slowdown in global trade, and possible in freer movements across borders generally too. It's the financial side which is showing problems at the moment, because there's no contagion financially coming from the virus - it's coming from people's view of the future."
"You can stop people moving, but you can't stop financial markets responding and they're moving very quickly."
Oxley says there is already discussion among historians about Covid-19 marking the end of globalisation as we know it.
Thursday, March 19 NZT
The storm clouds show no sign of clearing, with the Dow slumping another 6 per cent, and the ASX200 and NZX50 each another 3 per cent. Since the previous Monday, all three indices have lost between 19 and 23 per cent of their value.
Craigs Investment Partners issues a briefing note in the morning describing Covid-19 as "the ultimate black swan event" and saying discussions have moved beyond mere correction (a 10 per cent fall) or even recession (20 per cent) and are now drifting to depression (30 per cent).
Castle Point's Bennie, acknowledging he was still in the thick of it, this week said his own fund was down 8 per cent - a marked improvement over the general market - a result he puts down to having established a range of put options 18 months beforehand to hedge against such a crash.
He spent some time diving into the week's chaos to make some cautious purchases - picking up select stocks he believes the rapidly retreating markets now undervalue - but believes the crash is a long way from being over.
"This is starting to look more like a 50 per cent drop, not a 30 per cent drop," he says.
"There is little sign of it abating. The white knight is going to be a vaccine, and we will see people desperately trying to talk this up ... but it's unlikely to be less than a year away. In the meantime, the ramifications - as the world puts the shutters down - become greater and greater, and broader and broader. It's not pretty."
Other candidates for a white knight - development of an effective novel treatment, or mutation of the virus into a less-virulent form - enabling a return to business as usual are also likely to be at least six months away. And winter is coming.