COVID-19 UPDATE: Stimulus is in the headlines. Daily COVID-19 cases rising, but not yet exponential = watch for that
Click HERE to access the FSInsight COVID-19 Daily Chartbook.
STRATEGY: Markets are awaiting stimulus
If I had to identify the biggest development in the past week, it is the miraculous recovery of President Trump. Recall, earlier this year, many people would have cited a “black swan event” for the 2020 elections is one of the two candidates getting COVID-19. Well, it happened, and in a few days, President Trump seems to be back in good health. And it seems like the ball has moved forward (maybe inches) on incremental progress on fiscal stimulus. This is a good development.
But the progress of COVID-19 has not been necessarily positive. Daily cases are rising and surged to 53,572, the first >50,000 daily cases figure since mid-August. There is an uptick in daily hospitalizations, but the coefficient is a lot lower. So, we are in that phase where one can credibly dismiss the rise as “more testing” or “mini-surge” but the thing that would worry me, is if this turns into an exponential rise.
This only highlights how important positive progress on therapeutics and/or a vaccine. President Trump’s recovery seems to be a big win on the cure “column” and if that is correct, this rise in cases is less concerning. That is, because a timeline for a cure is also becoming more visible.
POINT 1: Daily cases surge Thursday >50,000, Flat is the new “good”
Daily new COVID-19 cases are rising, something apparent for the past few weeks, and rose to 53,572, the first >50,000 figure since mid-August. The 7D delta is also rising, so we are seeing a rise in cases.
Source: COVID-19 Tracking Project
The natural question is where is this outbreak taking place? And as you can see, the surge in daily cases stems from the 22 states still facing an outbreak.
– NY tristate (+MA+RI) is rising, but modestly
– FL, CA, AZ, TX is flat/down
Source: COVID-19 Tracking Project
This is a breakdown for total new cases in the past week (right set of data) and you can see, the surge is coming from states outside the top 10 in the US (outside NY tristate and F-CAT).
– but this does not minimize the fact daily cases are surging
Source: COVID-19 Tracking Project
I think multiple factors explain this rise, but it comes down to America is letting down its guard. That is the unifying explanation.
Source: COVID-19 Tracking Project
Again, the daily change vs 7D ago, in our view, is the leading indicator as it is what influences the 7D moving average.
– The next few days are key. But if daily cases rise vs 7D ago, we know the trend is now up.
– so far, we are not seeing 7D delta soar, so cases are not leading to an exponential spread
– the 7D delta is the highest in several months, and we need to go back to July to find a higher level
– the mid-Sept surge is distorted due to the Labor Day holiday.
Source: COVID-19 Tracking and Fundstrat
Daily deaths are still trending lower and for the moment, that is the good thing. In the US, about 700 Americans are dying each day from COVID-19. This is about 260,000 per year, so it is not a number to be ignored. And the key issue is keeping daily deaths low.
Source: COVID-19 Tracking and Fundstrat
Source: COVID-19 Tracking and Fundstrat
POINT 2: 20 largest states = 80% US GDP. Every state <100 deaths per day
We thought it would be helpful to end this week by looking at the state of COVID-19 within the top 20 states of the US. Collectively, these 20 states are 80% of US GDP, so the direction of cases in these states is the most important, arguably.
– below are summary stats below
– but to highlight some key trends, we made a few charts to make this more apparent
Source: COVID-19 Tracking Project and Fundstrat
About half of these states have “good” levels of spread: daily cases per 1mm <100…
A decent benchmark for measuring the rate of spread in a state is daily cases of less than 100 per 1mm residents. This ends up annualizing to an annual confirmed rate of 4% per year. So keeping daily cases <100 is a level of “contained spread”
– 9 of 20 states have daily cases <100
– Of the top 20, CA, MA, NY and WA have the lowest levels
– Given these low levels, does NY state’s new stricter measures seem overkill?
Source: COVID-19 Tracking Project and Fundstrat
9 of 12 Top 20 states have positivity rates <5%
The WHO views a positivity rate <10% as a controlled level of infection. And a figure <5% is considered very well controlled. 9 of the 12 states have positivity rates <5%.
– NY and CA are among the lowest
– Only FL and IN have a level above 10%, which is considered by WHO as less controlled
Source: COVID-19 Tracking Project and Fundstrat
Mortality is still very low in these states…We also thought it helpful to look at the absolute level of daily deaths in these 20 states. The reason daily deaths matter is this gives us an idea of the magnitude of the pandemic tragedy within these states.
– FL has the highest number of daily deaths at 91 (7D avg)
– NY state has 9 per day but this is the state implementing new restrictions (overkill?)
This is the key metric. There are many healthcare forecasters who expect daily deaths to begin surging this winter (IHME, for instance) and this is something we need to watch.
Source: COVID-19 Tracking Project and Fundstrat
POINT 3: Only “post-infected” can forget masks. The rest of us need some protection
If President Trump is indeed recovered from COVID-19, this is one of the most positive developments regarding the path of this pandemic. Why? There are multiple reasons, but the things that came to the top of mind:
– Pres. Trump was admitted to the hospital due to low oxygen levels, which seems to suggest some problems and risks in the lungs
– Pres. Trump has multiple risk factors including age (>70) and being overweight, but does not look obese
Yet, a mere few days after his testing COVID-19 positive, he is well enough to return home. And his tweet storm of the past few days shows he is back in strong form.
Source: NY Post
President Trump was administered multiple treatments over the past few days, including:
– Zinc and Vitamin D
– Remdesivir
– Regeneron antibody treatment
– steroids
This combination of treatments seems to have been quite effective, and as the video above shows, the President seems to have largely recovered. And while we do not know if one of the above treatments is responsible for its success, the real takeaway is the President seems largely cured. In this video, he also suggests he will make multiple doses of this cocktail available for sick Americans for no out of pocket cost.
As I have written about multiple times, COVID-19 is a mysterious disease, and even attempting to forecast the future path is extremely difficult. We have been fairly convinced of the forward path of the disease multiple times in the past 8 months, only to see COVID-19 follow a completely different path.
As we comment above, COVID-19 is spreading in the US, and while the mortality is well managed, we are all at the individual risk of exposure. So, from a practical perspective, the most important thing we can individually do. Each of these below is backed by credible science and studies:
– take Vitamin D/Zinc supplements, since this boosts our immune system
– wash our hands, since that is what is most commonly in touch with our nose and mouth, thus, clean hands = less risk
– use some protection against the pathogen, which is a mask or social distance
Because of all the intimations that I am an anti-masker, here is my personal regimen…
I have a few kids in school, one of which is in high school, I am not taking risks of infection — I don’t want to be the parent that is the one that shut the school down.
I have a pile of KN95 masks in my car. My daughter’s friend happens to own a factory that makes these masks and he sent me a boatload.
And I have hand sanitizer in the glove box — can’t have too much of this around
Of course, this in my pocket
And don’t forget the Vitamin D! Dr. Fauci takes this!!!
Regarding the masks, a few versions were sent to me that I found humorous…
This is not a mega-wedgie. This is an intentional use of briefs as a mask.
And our Head of Global Portfolio Strategy, Brian Rauscher, shared a funny article from the Daily Mail showing some other odd masks seen on the NYC subway (MTA). The link to the article is here –> Daily Mail article
