If you have been paying attention to the news lately you may of heard of the threat of bird flu and a world pandemic. What would this mean and how would it affect your financial holdings. The World Bank, which has estimated that a bird flu pandemic lasting a year could, cost the global economy up to $800 billion dollars. The economic toll on the world economy will be catastrophic. That is a forecast no investor wants to hear. Even a "mild" pandemic could wreck havoc with your investments.

During a flu pandemic millions of people would be unable to work due to illness and taking care of sick family members. Schools and businesses would be closed, transportation reduced or halted. Ill truck drivers, rail and warehouse workers would bring interstate commerce to a grinding halt. How many air traffic controllers could be out sick before flights were cancelled? International travel would all but be eliminated. Businesses hardest hit would include retail, trade, education, travel and tourism, public entertainment and anywhere large groups of people would gather such as sporting events and concerts. Import and exports markets would be devastated.

With millions out of work and unable to pay their bills including rent and mortgage payments, financial institutions facing mounting defaults would have no choice but to suspend debt owed until the pandemic was over. Other financial institutions would face similar threats of collapse until business returned to normal. But, how long would that take? Thousands of businesses may never be able to recover resulting in the loss of millions of jobs. Large and small businesses alike may loose key employees who would be difficult to replace. Moving forward businesses would face labor shortages due to the millions who died, making a return to full productivity difficult.

The global economy could take years to recover. Individual business recovery could be painfully slow. Government spending to aid recovery would go through the roof, yet they would be receiving less in tax revenue from businesses that closed and individuals out of work. The stock value of the largest businesses could collapse devaluing millions of investor's portfolios. Investors may dump their stock holdings in favor of cash and hard assets like gold and silver. Housing prices could plunge as millions of homeowners go into default. Financial panic could wreck the markets in short order.

Many essential items could be in short supply due to loss of production capacity. Gas and oil deliveries could take months to return to normal production. Consumer spending would be down further delaying economic recovery.

Global instability would be the rule rather than the exception. 3rd world countries devastated by the pandemic could face new internal struggles for power as whole armies could be wiped out by the flu. International trade relations we once had may no longer be there.

A world pandemic would set the dominos in motion. One event would trigger another; one financial collapse would bring on the next one. The results would be nothing short of catastrophic.

As an investor your first course of action is to stay informed. A bird flu pandemic may not happen for years, but health experts say it will happen, it is just a matter of time. But then there is always natural disasters and terrorism to worry about. The more you know about a possible bird flu pandemic the better position you will be in to adjust your portfolio accordingly when the time comes if not sooner.

Diverting a portion of your assets into stocking up on essential food and supplies may be a prudent move, since a pandemic may keep you housebound for months at a time. No well-diversified portfolio will help you out when the grocery stores are closed and you are waiting in line for a government hand out.

Stay informed, plan accordingly, and be prepared.

About the author:

To stay up to date on avian influenza, bird flu and the h5n1 virus visit The Bird Flu Index http://www.birdfluindex.com Find links to bird flu websites, official medical and government sites and full information about how the bird flu could turn into a global influenza pandemic. Search through the article archive for the latest bird flu articles. For the latest bird flu news visit The Pandemic Zone http://pandemiczone.blogspot.com