Authorities around the world have to perform a delicate balancing act in their response to the latest pandemic threat from the swine flu outbreak originating in Mexico. The flu virus is so unpredictable and scientific knowledge about the latest strain so scarce that no one can say yet with any confidence whether a pandemic is imminent – and if so how lethal it will be. A real sense of urgency is needed to prepare health systems for the worst; yet it is essential to avoid public panic and overreaction, which could do more harm than the disease itself.

Big falls in travel and leisure companies' shares yesterday gave a glimpse of the potential economic damage that fear can inflict. The 2003 Sars outbreak, which never escalated into a pandemic, cost an estimated $50bn – at a time of worldwide growth. We are more vulnerable to the fear factor now, with economic morale much lower.

Some proposed responses to swine flu would be excessive. Screening travellers from infected regions and advising against non-essential travel may be sensible but outright bans on movement are not; epidemiologists say travel bans are ineffective in limiting the further spread of such a contagious virus once it has moved beyond its birthplace. Trade embargoes, such as stopping the import of Mexican meat, are pointless too.