Click HERE to access the FSInsight COVID-19 Daily Chartbook.
STRATEGY: Washington in focus this week, DNC and CARES Phase 4…
The trend in daily cases is improving and is falling each day vs 7D ago — Wednesday’s cases came in at 43,553 vs 55,676 7D ago. But this trend is not entirely clear, because of the daily seasonality of case data. Because of lab and weekend hours, more cases tend to be reported midweek. So, this distorts the perception. Thus, we prefer to compare cases vs 7D ago. The second is the reporting methodology has shifted away from the CDC to the White House. While some conspiracists would say this is creating fake numbers, we believe every state would protest if the numbers did not align with their own death and case data.
Source: COVID-19 Tracking Project and Fundstrat
Also, daily cases are falling across the US in the same pattern. Below, we show 3 composites of the 51 US states and territories outside NY tristate (plus MA + RI):
– Epicenter, FL, CA, AZ, TX, or F-CAT
– 18 states with high prevalence (>12,500 cases per 1mm)
– 29 states and territories with low prevalence (<12,500 cases per 1mm)
– all based on daily cases per 1mm residents
Don’t these charts look identical? The trend of retreating cases is exactly the same across the US.
Source: COVID-19 Tracking Project and Fundstrat
After achieving an all-time high, equity markets are, not surprisingly, consolidating gains. Washington is in the spotlight this week, stemming from the Democratic National Convention taking place this week (nominating convention for Dems, for our global clients) and the continued impasse with Washington. Below is a great summary of Tom Block, Fundstrat’s Head of Policy Strategy, views on the DNC so far. The best parts, so far, per Block, are Jill Biden’s speech and the roll call.
https://www.marketwatch.com/articles/democrats-nominate-joe-biden-for-president-what-wall-street-thinks-51597807951
We believe there is a lot of signal in the equity markets achieving all-time highs — even if someone has been skeptical, the key question one needs to ask:
– do you want to be right or do you want to make $$$?
By the way, it is pretty common for stocks to make all-time highs while in the middle of a recession (although we are in a Depression). As Ryan Detrick, of LPL notes, there are 5 instances, where stocks made “new highs” while in a recession.
– Feb ’61
– July ’80
– Nov ’82
– Mar ’91
– Aug ’20
https://twitter.com/RyanDetrick/status/1295817129531510787
POINT 1: Obvious now, daily cases are crashing…
Daily cases rose to 43,553 on Wednesday but this is the typical midweek seasonal pattern. As we have written extensively recently, because of the seasonality of the week, daily cases should be compared to the one 7D ago. And this is also a positive development.
Source: COVID-19 Tracking Project and Fundstrat
When we line up the daily cases for each day of the week and look at the last 5 weeks, we can see the scale of the slowdown in COVID-19 cases. The R0, in other words, is <0. If it were >0, we would expect cases vs 7D ago to be higher.
Source: COVID-19 Tracking Project and Fundstrat
And the 7D delta highlights the magnitude of the collapse. CA backlog is largely clear, but because CA is in the prior week’s data, the full 7D delta is not clean until next week. So for the rest of this week, we will highlight the 7D delta with and without CA.
Source: COVID-19 Tracking Project and Fundstrat
Source: COVID-19 Tracking Project and Fundstrat
POINT 2: COVID-19 cases are in retreat essentially across the entire US
We have written about the magnitude of the retreat seen in the 4 epicenter states, FL, CA, AZ and TX, or F-CAT, and the declines seen in these 4 states really lines up very close to the retreat seen in NY tristate + MA + RI. This is a big deal, in our view, because F-CAT did not implement the strict economic closures of NY tristate, yet, the collapse in cases is similar.
– the exception is CA, and this reflects the backlog which is distorting case trends.
Source: COVID-19 Tracking Project and Fundstrat
But the more important story, in our view, is that daily cases are retreating across the US. You might hear about one or two states which are seeing an uptick.
– Our view is that the 29 states with low levels of case prevalence, below 12,500 cases per 1mm residents, will likely face a greater risk of a surge.
– The 29 states are the red line on this chart below.
The chart is a composite of daily cases based on the 4 categories outlined. In the sheer number of cases, the F-CAT is the largest. And F-CAT totals are larger than the 18 other states with high prevalence (>12,500 cases per 1mm).
Source: COVID-19 Tracking Project and Fundstrat
But the cases are turning down broadly across the US. We plotted the same lines, but showing daily cases per 1mm residents, to make the lines more comparable. And not surprisingly, F-CAT had the highest levels of daily cases per 1mm residents. Across all 4 categories, these lines are turning lower.
Source: COVID-19 Tracking Project and Fundstrat
Isolating each state, we can see the same pattern of a peak in daily cases and the downturn…
Looking at each of these lines in isolation, we can see the downturn in daily cases is consistent across these 51 US states and territories (ex-NY tristate + MA + RI). This should really underscore the trend in falling cases is broad-based. This is consistent with the possibility that the national hysteria about the case surge caused Americans everywhere to become more vigilant. Thus, daily case trends are mirroring each other across the US.
Source: COVID-19 Tracking Project and Fundstrat
POINT 3: Solar cycle might be responsible for global pandemics? Not as crazy as it sounds…
I was listening to the podcast Mysterious Universe and one of the topics was questioning if solar cycles are responsible for global pandemics. I have to admit, this sounds silly and “really out there” — but there might be some actual science behind this.
Prof. Chandra Wickramasinghe is the Tom DeMark of virus research…
Before you stop reading, take a look at this “warning letter” written November 25, 2019 by Prof. Chandra Wickramasinghe of the UK Buckingham University. He warned of a risk of a global pandemic that would start between July 2019 and September 2020.
– WUT?!
https://cosmictusk.com/wp-content/uploads/CurrentScience2020-copy.pdf
Was this professor lucky?
I mean, how many other people, in this world, warned of a global pandemic coming in 2020? Like not somebody who wrote a script for a movie, or someone who said this would happen for a decade. Prof. Chandra Wickramasinghe is almost like the Tom DeMark of the virus world. FYI, Tom DeMark pretty much nailed the timing of this equity market perfectly.
There is a ton of research on “solar cycles and pandemics” — yup
But I decided to do some more research on solar cycles and the potential explanation for pandemics. And there is a LOT of research on this topic. The one paper that seems to be more frequently cited in modern times is a medical hypothesis from John W.K. Yeung published in 2006. Looking at the multiple papers, a few of which are summarized below, here is what seems to explain this solar cycle and connection to pandemics:
– Solar cycles affect temperatures, which in turn, affect avian migration cycles, which change disease spread –> Yeung, 2006
– Solar cycles affect the output of solar ultraviolet B (UV-B) which is the main source of Vitamin D –> Daniel Hayes, 2009
– Solar cycles affect the Earth magnetic field, which allows space viruses to enter Earth –> Wickramasinghe, 2019
So you can see, there is not a consensus for why Solar cycles lead to pandemics, but there is a startling 11-year cycle of pandemics and apparently, many historical pandemics happened near “solar minimums” or when there are few sunspots.
Yeung and the original study of solar cycles and pandemics from 1700 to 2006…
The earliest, or at least most widely cited study, is the one published in 2006 by John Yeung. He noted that solar cycles are 11-years and that many modern pandemics were 11-years apart. This is fairly true:
1918 Spanish flu
— gap —
1946 H1N1 +28 yrs
1957 Asian influenza H2N2 +11 yrs
1969 Hong Kong flu +11 yrs
1977 H1N1/Russian flu +11 yrs
— gap —
2009 H1N1 +22 yrs
There are a few gaps, but this did catch my attention.
Source: Elsevier
He highlights a pretty interesting cycle, and as his analysis below highlights, when sunspots <50 (aka solar minimum), influenza pandemics happened in 85.7% of these instances. This is based on pandemics from 1700 to 2006, or 306 years of pandemics. His quote:
“The sensitivity of using SSN > 50 to detect influenza pandemics was 85.7% (95%CI = 59.8–100%, p = 0.019). The specificity was 51.2% (95%CI = 35.9–66.5%).”
So there is a statistical relationship between pandemics and solar cycles. But as this abstract above highlights, he proposes that climate impacts from solar, affect migratory patterns of birds. And this is what causes diseases to circulate and mutate and jump to humans.
Daniel Hayes suggests Vitamin D is reduced during solar minimums…
Daniel Hayes, in his 2009 medical hypothesis proposes the connection to solar cycles and diseases is Vitamin D. We have written multiple commentaries on Vitamin D, citing many research studies showing how low Vitamin D is associated with severe COVID-19 outcomes. And how certain ethnic communities have chronic low Vitamin D –> Latinos and Black. So, this hypothesis caught my eye.
Source: Elsevier
Basically, Hayes assertion is that Solar UV-B is affected by the interaction of the atmosphere with UV-C and how UV-B is affected by this cycle. High UV-C levels reduce UV-B.
Source: Elsevier
While he points out higher UV-B during solar minimums, which Yeung and the Professor say is when the pandemics happen, it seems to be more a timing issue.
– Going from Solar “Max” (low UV-B) to Solar “Min” (high UV-B) is the time when Vitamin D levels are lowest (improve during minimum)
– The pandemic cycles highlighted show the pandemics happened between these periods.
This is consistent with the pandemic charts done by Yeung. Below are the solar cycles and the boxes are pandemics. They do seem to happen between the solar maximum and before the solar minimum.
Source: Elsevier – Yeung
The 2019 theory of “Space viruses”…
Prof. Chandra Wickramasinghe was suggesting that the next solar minimum, a period when there are fewer spots, was going to be one of the deepest in more than a century. Thus, he expected the high risk of a viral pandemic and even cited the 1918 Spanish flu.
https://cosmictusk.com/wp-content/uploads/CurrentScience2020-copy.pdf
Here is the graphic this letter contained, and then the number is at the nadir, this apparently is when pandemic risk is highest. Oddly, this last bottomed 11 years ago in 2009, and oddly, there was the H1N1 flu pandemic.
https://cosmictusk.com/wp-content/uploads/CurrentScience2020-copy.pdf
The rationale for Prof. Chandra Wickramasinghe seems really strange — space viruses…
But his rationale is quite strange. His assertion is that there are viruses from space, and they enter the Earth’s atmosphere when sunspots are low. I am not a scientist, but this sounds like a plot of a movie. However, there was a large comet that exploded over China in October 2019. Here is a YouTube video link.
– Personally, I am not so sure about “space viruses”
