How does a new strain of flu or stomach virus evolve? how fast does this happen?

Great question: The answer is, however, not as simple as can be described here. But, to simplify, all life forms have random mutations that occur as the organism replicates. Some of these benefit the survival of the form, others don't. Those that do, go on and propagate. In flu, there is also mixing of the genetic material in other animals besides man (pigs and birds). In these, new strains emerge - some bad.