COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.

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.


Tuesday developments around COVID-19 were muted relative to the major events of Monday (Moderna + Powell).  Surfacing to the top are the revelation President Trump has been taking HCQ (hydroxychloroquine) prophylactically and Michigan announced a new timeline to open the northern regions of the state (more vacation areas).  But the “sleeper” milestone is likely the fact Connecticut (CT) is set to ease widespread restrictions on Wed 5/20/2020.  Among this first phase of opening: restaurants (outdoor dining), retail + malls, hair salons, museums/zoos, and offices.

CT is the first NY tri-state to reopen and is also domicile for many financial industry players (both residents and offices).  Therefore, much of Wall Street’s perception of this crisis is shaped as much by NYC as it is by the widespread restrictions in Fairfield County (home to Greenwich, Darien, New Canaan, Westport and other tony suburbs of NYC area).  Parks in many of the counties opened several weeks ago, but the opening for commerce is quite a milestone and could also improve the Street’s perception of the state of the crisis.

As far as case data today, it was an overall improvement with daily cases down 1,516 to 19,785 but mid-week is when we usually see jumps in cases.  And there was the expected churn.  5 states saw notable increases and 4 of the 5 (MD, TX, VA and GA) have eased restrictions more than the US overall.  But as we discuss below, it is too early to attribute this to more than normal daily volatility caused by testing lags.

President Trump also signed a new executive order that will loosen regulations, to abet the economic recovery.  In the last 50 years, President Trump is the most successful (tied with Reagan) for reducing the federal employment of regulatory staff.  Our data comes from the Regulatory Studies Center of George Washington University.  Under Trump’s administration, total Federal Regulatory Agencies employment has fallen 0.9% annually, reversing the staff increases seen in every President since Ronald Reagan.  Reagan championed de-regulation and famously de-regulated airlines in his Presidency.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: Fundstrat and Regulatory Studies Center of GWU

The reduction of regulatory friction is probably good for business flexibility and leads to streamlined and faster capital deployment.  So, in this sense, it is a good thing. The latest NFIB small business survey shows that “regulation” is #4 of the 10 issues for small biz today, so it is up there but sales, taxes and labor are bigger issues.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: NFIB survey





POINT #1:  USA daily COVID-19 fall -1,516 to 19,785 (vs 1D ago) but mid-week is where jumps take place.  Drops: IL, NJ + CT
Total US cases are continuing their ever steady drift lower (see chart) and total reported cases was 19,785, down -1,516 from yesterday and down 45% from the high of 36,116, 25 days ago. 

– This figure works out to 60 daily cases per 1mm US residents and is certainly better than the 109 at the peak on 4/24.
– But Western Europe averaged 20 daily cases per 1mm residents, which means the USA needs to get this figure to 6,600 equivalent.


COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: COVID-19 Update


6 state saw biggest drops, but ignore Kansas (only reports M/W/F)
These 6 states (ex-KS, it’s 5) and accounted for the majority of the drop today.  The drop in FL is encouraging, as the state has eased restrictions and opened beaches and many are wary of a second wave.  The drops in IL and NJ are also encouraging, as these 2 states saw quite a surge in the past week or so.  And CT and MI are easing restrictions, so it is good to see better case numbers.

Illinois                1,545  vs  2,294 (1D)   -749
New Jersey          974  vs  1,705           -731
Kansas                     0  vs     454           -454 <-ignore
Connecticut          314  vs     697           -383 <-opens 5/20
Florida                  502  vs     854           -352
Michigan               435  vs     773           -338
Total 5 (ex-Kansas)                             -2,553

5 states reported increases today.  And it is expected to see volatility.  But it is noteworthy that 4 of the 5 states reporting increases have also been states with eased restrictions.  MD has opened its boardwalk in the past few weeks.  

Maryland            1,784 vs    958  (1D)   +826 <-open
Texas                 1,219  vs   909            +310 <-open
Virginia               1,005  vs  752            +253  <-open
New York            1,474 vs 1,250           +224
Georgia                  640 vs   439            +201 <-open
Total 5 states                                      +1,814



COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: COVID-19 Tracking Project


Maryland reporting a rise in cases, and the state eased restrictions on 5/15…MD Gov Larry Hogan eased restrictions for MD on 5/15, opening retailers, hair salons, churches and had cited improving key health metrics like hospitalizations and capacity.  The rise in cases reported today is not necessarily a cause for alarm (see below) because this spike could ultimately due to “testing lag” rather than new waves of cases.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source:  https://wskg.org/npr_story_post/maryland-reports-largest-rise-yet-in-coronavirus-cases-4-days-after-reopening/

Maryland daily COVID-19 cases hovered around ~1,000 per day for most of the past week and this 1,784 spike stands out.  In fact, there was a similar spike on 5/1/2020.  And as I am accustomed to, this is often due to testing lags. The Governor did not mention this in any commentary today, so we are watching this spike. But not necessarily alarmed.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: COVID-19 Tracking Project




POINT #2:  CT is opening this week, a major milestone as the first “NY tri-state” to open. 
Connecticut is set to make the most significant ease on restrictions on 5/20/2020 and as CT Gov Ned Lamont notes, metrics are good as hospitalizations are down and % tests positives are low.  While much of the world would consider CT quite small (it is), the significance of the state is the fact it is the first NY tri-state to open (NY, NJ, CT).  And much of the financial community lives in Fairfield County (Greenwich, etc) and as such, the opening of this state carries a large perceived impact for the financial community.  Fairfield County has a very large share of global hedge funds based in that area.

CT kept many essential businesses open, including landscaping, etc.  

– But for those in need of hair trimming, hair salons are part of the phased opening.
– Restaurants (outdoor dining) and retail are open as well.

This is a pretty broad-based opening and good news for the state residents.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


source: CT Governors office


CT is one of three states to ease restrictions on retail this week (+CA surprise makes it 4) as Kentucky and Vermont are also opening parts of retail this week.  

One thing to note, as more states open, there will be a lot more disjointed information, as some states open regionally and in phases.  So it will be increasingly challenging for us to appropriately track this.  But I think the most important is to highlight important milestones.  CT, for reasons noted above, is actually a big deal.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: State websites and Fundstrat


New York capital, Albany, set to open this week…
More parts of NY state are opening as well.  NY Gov Cuomo in his press briefing noted that the Capital Region (Albany) meets essentially 7 of 7 criteria and is set to open 5/20 (assuming they secure contact tracers).  And as the graphic below highlights, much of NY state is meeting the necessary criteria, without the NYC metro area (including Long Island) as behind.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: NY Governors office

But Gov Cuomo does seem to show some flexibility, as he announced today that Nassau County is now eligible for elective and ambulatory surgery. Hospitals have suffered badly during this crisis, as the higher fee elective surgeries and treatments were not allowed.  So this is an economic boost to Nassau County (which is on Long Island).

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: NY Gov office

NY state metrics continue to show steady improvement, both in daily reported cases and hospitalizations.  The chart below highlights that NY state is pretty much reaching new lows for both of these metrics.  

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: NY state health dept.


Michigan also announced phased opening of the upper regions of the state on 5/22/2020…
Michigan was one of the hardest-hit states early in this crisis (Detroit area) and as the state remain closed, the state saw protests at the capital from residents wanting to open the state.  And today, MI Gov Gretchen Whitmer announced the opening of the upper portions of the state.

– Detroit and the major population centers are actually in the lower portion (still closed) and those upper regions tend to be popular tourist and vacation destinations.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


Source: State of Michigan


Yellowstone National Park opened today… to a crowd of thousands
As the US approaches summer, the focus will be on vacation destinations.  It was reported today that Delta noted an uptick in travel bookings.  And major US tourist destinations are beginning to open.  Yellowstone National Park (in Wyoming) is the nation’s first national park and one of the most popular in the US.  It is most famous for Old Faithful, the geyser.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


https://www.theguardian.com/environment/2020/may/19/yellowstone-coronavirus-reopening-grand-teton-covid-19


COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.



POINT #3: Revisting serology studies — 23 total, 12 foreign + 11 USA, all point to COVID-19 prevalence 10X to 50X to 85X greater
It has been a while since we spoke about serology studies or the tests of antibodies.  Data compiled by our data science team, led by tireless Ken, have identified 23 total studies (12 foreign and 11 in the US).  And they all point to a similar conclusion.  For every confirmed COVID-19 case, there at 10X to 50X to 85X more residents with antibodies.

– Iran (4/26) showed 33% of those tested had COVID-19 antibodies, 322X the official case infection rate (CIR, 0.1%) at the time;
– Slovenia (5/6/2020) 3% of tested positive, 43X official CIR;
– Kobe, Japan (4/26/2020), 2.7% positive, 401X official CIR

Even in Asia, there is a higher prevalence than is officially reported. We have plotted these studies below, one for foreign studies and one for domestic studies.

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.



Why does this matter?  Two takeaways. First, reinforces most cases are asymptomatic (10X to 80X) and two, can we ever really get to zero cases?
The serology studies raise questions about the appropriate policy going forward.  Today, the policy guidance and framework is based solely on official case confirmation (test confirmed positive by an approved lab) and as such, the benchmark that guides states and policymakers is the official case count.  The public focuses on this as well.

And ultimately, everyone hopes for cases to fall to zero.

But the serology studies show that for every official counted case, there at 10X to 50X to 80X more cases.

– hospital visitations are tracked, this suggests many COVID-19 cases are mild and asymptomatic and required no hospitalization;
– the higher number of asymptomatic cases means detection methods like temperature readings, etc may not be as effective;
– getting to zero cases may be impossible. The Kobe study (Japan) highlights there may be many more COVID-19 cases than realized

Ultimately, this is not necessarily positive news.  This just shows COVID-19 is much harder to eradicate.  And this is why treatments + vaccine matter so greatly.  But we would view treatments as more important, given the high number of implied asymptomatic cases. 

This also suggests that we should expect cases to be here for some time, spreading via these undetected cases.  And conversely, the risks for states re-opening is mitigated by this.  Even during the strictest stay at home measures, the US saw cases rising.  

COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.



COVID-19 UPDATE: USA daily cases ease -1,516 to 19,785. Connecticut opening 5/20/2020 carries greater significance given heavier Wall Street presence.


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