COVID-19 UPDATE: COVID-19 deaths ex-nursing homes and ex-Tri State area --> ~19,000, or 74% lower.
COVID-19 remains a global crisis and we realize that many people need to keep up with COVID-19 developments, particularly since we are moving into the more critical stage (“restart economy”), so feel free to share our commentary to anyone who has interest.
For anyone who was driving around the US this weekend, one would have noticed a pretty sizable increase in cars on the road. For those in the Northeast US and NY tristate area, local governments are opening some city parks and coupled with improving weather, is a factor for the increased traffic. But of course, this is going to make a lot of people uneasy and every person has a different degree of comfort with social distance. COVID-19 is still a serious issue for many cities (the chronic states of NY, NJ, CT, MA, IL, etc), so I understand how this causes concern. And as there is greater movement, and more states relaxing restrictions, the two logical things to monitor is:
– individual compliance with mitigation measures of PPE, hand washing, social distance
– cases reported data since symptoms appear within 1-5 days
But the healthcare tragedy of COVID-19 is concentrated in two epicenters: first, NY/tri-state area (~38% cases and 45% deaths) and nursing homes (~17% cases and 42% deaths) (we expanded the analysis to 19 states, or 66% US). Thus, ex- NY tri-state and ex-nursing homes:
– total US COVID-19 deaths 19,483 vs 73,569 total. In other words, dramatically lower.
Researches at Mt Sinai posted a study that suggests those who had COVID-19 have a degree of immunity (NY Times article, https://www.nytimes.com/2020/05/07/health/coronavirus-antibody-prevalence.html)
Mt Sinai researchers published a study on MedRxiv last week (multiple authors) and the NY Times published an article on May 7. The study looked at convalescent plasma and tested for antibodies. The study has not been peer-reviewed, but their conclusion is that they believe patients who were previously COVID19 positive have antibodies “potentially providing immunity to reinfection.”
Source: https://www.medrxiv.org/content/10.1101/2020.04.30.20085613v1?referringSource=articleShare
This is one of the first studies to suggest that people with COVID-19 have some sort of immunity and that is a good thing. Foremost, it does suggest there could be eventual herd immunity (absent a vaccine or treatment). And it would reduce the risks of allowing such individuals to return to the workforce.
The future path of the US economy remains uncertain and therefore we understand how this leads to bifurcated futures and uncertainty among investors. But the strong equity market gains this past friday, on the heels of the worst ever reported jobs report in history, highlights how much bad news has already been discounted with equities. We are largely through 1Q2020 EPS. And recall the gauntlet of horrific health and economic news over the past 5 weeks. And yet, equities have managed to sustain gains. We see this as evidence stocks are in the hands of buyers.
POINT #1: US cases fall to NEW LOW 20,954, -42% from peak 16 days prior (4/24/2020)…
US COVID-19 cases fell to 20,954, a pretty sizable drop from 25,100 on 5/9/2020 and 27,565 on 5/8/2020. So the past few days have seen a cumulative drop in daily reported cases -6,611. Weekend reporting tends to be somewhat inconsistent and thus, given reporting lags, case figures for Sundays and Mondays can seem artificially low. But still, the trend in cases is still improving. And there does not seem to be a “new outbreak” in any city/state and the high case counts remain with those same states.
– the 20,954 represents a new cycle low for daily reported cases, falling below the previous cycle low of 21,844 reported 5 days earlier on 5/5/2020.
Source: COVID-19 tracking project
IL, NY, MA, OH and NJ comprise the biggest 2-day drop in cases…
Most of the 50 states reported a 2-day drop in cases but the top 5 biggest drops accounted for about 50% of the decline from 27,656 to 20,954.
– IL 1,656 from 2,887 -1,231
– NY 2,273 from 2,938 -665
– MA 1,050 from 1,111 -562
– OH 384 from 885 -501
– NJ 1,447 from 1,819 -372
Total 5 states -3,331 –> 50% total drop
These 5 states are among those with chronically high cases counts, so it is good to see their daily figures fall. But as we noted, there remains inconsistency for reporting on Sunday and Monday (weekend lags) so it is difficult to read too much into the reported data.
Source: COVID-19 tracking project
More talk about “% positive” tests and the 10% threshold recommended by the WHO
We are hearing more talk about the “% tests positive” benchmark. The WHO sees a figure <10% as a sign of progress and thus, recommends that as a hurdle before easing restrictions. Scott Gottlieb, former FDA commissioner (and all around level-headed voice in this crisis) tweeted about this over the weekend.
– he notes many states are seeing % positives fall below 10%. As one can see from this chart, even states like FL, TX and most of those which have opened are below 10%. GA is not, but their ~15% is not too far off.
source: twitter
Total testing >300,000 for 3 of the past 4 days, and despite that US reported daily cases are declining = good thing…
Total testing in the US continues to track higher and have been >300,000 in 3 of the last 4 days. The fact that reported cases are generally declining despite high levels of testing is encouraging.
Source: COVID-19 tracking project
POINT #2: Expanding nursing home data to 19 states (~67% US pops) –> still 42% of overall COVID-19 deaths. NY Gov Cuomo increasing scrutiny of nursing homes.
42% of US COVID-19 deaths are from nursing homes — looks like NY state data is under-reported…
Last week, we discussed the tragic disproportionate contribution of nursing homes to COVID-19 deaths. We have compiled data from 10 sates (~50% of US). Our data scientist team, led by tireless Ken, expanded this to 19 states (~66% of US). And the data remains consistent — nursing homes are 42% of COVID-19 deaths.
– the largest is CT with 79% of deaths from nursing homes, followed closely by PA (70%)
– the lowest figures are from NY (26%), South Carolina (30%) and Florida (32%)
The NY figures for “nursing home” deaths are potentially under-reported and the state, it appears, does not list nursing home residents who were transferred to a hospital and subsequently died from COVID-19.
Source: Various state dept of health
NY state nursing home deaths could be “under-reported” as those transferred to a hospital and subsequently dying are not counted…
This is an abstract from a FOX5 story regarding nursing homes. The link to that article is here: https://www.fox5ny.com/news/more-than-1700-new-unreported-deaths-at-nursing-homes-in-ny
source: Fox5NY
The tragedy around nursing homes is not lost on the states. In fact, NY Gov Cuomo today instituted new rules for nursing homes and their employees. Specifically, he is requiring all staff to be tested 2X per week. He is making this mandatory and will revoke the license of any nursing home that fails to comply.
Source: Twitter
Based on 19 states. Nursing homes residents 0.4% of the population, 17% of cases and 42% of deaths… incredible
The aggregated data for the 19 states is shown below. And the results remain shocking. Of the 220 million residents in the 19 states:
– Nursing home residents are 940,361 or 0.4% of the total
– Nursing home cases are 17% of the total (MI and TX do not breakout the case numbers)
– Nursing home deaths are 20,581 of the total 53,302 deaths reported in those 19 states (42% of total)
These are consistent with the 10 we highlighted last week. The bottom line is COVID-19 exploded through nursing homes in every state — leading to tragic surges in deaths and hospitalizations.
Source: Various state dept of health
Ex-Nursing homes and ex-NY state, COVID-19 Case Fatality rate is 3.1% vs 5.7% US overall…
The calculated case fatality rate (CFR) is based on COVID-19 deaths divided by “official” confirmed COVID-19 cases. And we show the CFR for those 19 states based upon both total and ex-nursing homes.
– ex-nursing homes, the CFR drops from 5.7% to half to 3.1%
– nursing home CFR is 16.2%
These are based on “official” case counts (confirmed positive for COVID-19 using a test). But serology studies suggest that the actual official case figures in the US are 10X to 50X to 87X higher. If we take the lower end of that figure, the CFR for the US is likely around 0.3% ex-nursing homes.
Source: Various state dept of health and Fundstrat
Total US COVID-19 deaths drop to 25,350 ex-nursing homes and ex-NY tri-state…
There are many implications of the fact that nursing homes are the second epi-center of COVID-19. The first by far is the NY state and the tri-state area (+NJ and +CT). But nursing home residents are retired and generally not large consumers of the US service economy (they are big consumers of healthcare). And as such, if the disproportionate deaths and hospitalizations from COVID-19 are from nursing homes, this does change what should be the economic framework for opening states.
Perhaps the easiest way to see this is to look at the compositions of US COVID-19 deaths:
– of the 73,569 reported COVID-19 deaths;
– NY tristate comprises 32,979 or 45% of the total;
– Nursing homes (ex-NY) are 27,462 or 37%;
– ex-Nursing and ex-NY, total deaths are 19,483
Think of it this way, COVID-19 deaths of 19k is pretty low compared to what are other causes of death in the USA and compared to other flu seasons.
Source: Various state dept of health and Fundstrat
POINT #3: Tesla struggle to re-open in CA is one of many battles fought throughout the US… per McKinsey, Companies in COVID-19 world NEED to adapt and change strategy in massively shorter timeframes
Tesla filed a lawsuit against Alameda County in Federal district court, seeking an injunction allowing the company to re-open its Fremont factory site. CA Gov Gavin Newsom has relaxed some restrictions, but counties are applying these changes selectively. And for Tesla, the county has denied the request to open the factory.
CA Politicians have been quick to criticize Tesla and Lorena Gonzalez, Assembly person in San Diego even weighed in with a tweet storm shown below. But Elon Musk and Tesla do not seem to be winning the sympathy of CA policy makers.
So not surprisingly, Tesla is threatening to move out of CA. Whether Tesla ultimately moves, and such timing, is not known.
Source: Marketwatch.com
Unfortunately, Tesla is one of many manufacturing businesses that cannot work “remotely”…
McKinsey & Company has published a series of papers discussing business strategy around COVID-19. And one of the more interesting takeaways is looking at businesses that can be effective while their employees are “working remotely” (https://www.mckinsey.com/Featured-Insights/Coronavirus-Leading-Through-the-Crisis/Charting-the-path-to-the-next-normal?cid=other-eml-alt-mip-mck&hlkid=3cafff782dc948f88f4ba24d9d0412a0&hctky=9489327&hdpid=e630e2db-b518-4c61-bbe5-7414c437f3e2)
The chart is below (with our annotations marked) and the industries with the least ability to work remotely are the obvious ones:
– hospitality, entertainment, healthcare and construction, retail and food
– manufacturing falls into the lower categories, according to McKinsey, which we do not fully understand.
Manufacturing requires people to work in a centralized location. But the issue for Tesla is whether employees can maintain safe distances with adequate PPE and ventilation. If this can be achieved, then many of the concerns of policy makers are overstated.
Source: McKinsey & Co
