Tuesday, March 31, 2020

Trying Times In The Fourth Turning

We are living in the most consequential time that most of us have ever lived in.

These are trying times and they are likely to get much more trying before they get better.

President Trump has been faced with decisions that I don't think any President has ever had to face.

Yes, other Presidents have had to make the decisions about the inevitable deaths of war. Those decisions also involved some personal sacrifices on the homefront as was the case in World War II. However, those sacrifices were generally balanced with an economy that did better due to the war effort. That is the crazy side effect of normal warfare. Factories are humming. People have jobs. Money is flowing in the economy

There are no good choices in the war we now have against what President Trump calls the "invisible enemy." A certain number of deaths are inevitable. Everyone is making personal sacrifices. The economy is taking an enormous hit. It is not even a zero sum game. It is a sub-zero game in all respects.

The mainstream media likes to portray Donald Trump as a dangerous, fast and loose decision maker. They would have you believe that he makes decisions in the same manner that he presides over a political rally with a lot of ad libs and very little preparation.

I have observed Donald Trump for a long time. I have read almost every book he has written and most of the books written about him in order to better understand him.

As I have analyzed Trump's decisions (both in business and as President) I see someone who calculates everything he does. He also invariably makes decisions that are anything but reckless or ill-considered. Yes, he may say outrageous things at times but when the final decisions or deals are made they are backed by good reasoning. The Left may not like the reason, for example the appointments of Gorsuch and Kavanaugh to the Supreme Court, but those were both pragmatic and practical choices.

Trump is generally well informed and has studied the issues in front of him in some detail. He has a good grasp of the facts. You see evidence of that in the daily press conferences where he stands up for an hour or more and answers a range of questions. He may have made money in the casino business but Trump does not make ill-advised bets or decisions.

It should therefore come as no surprise that he listened to the facts that his team of public health experts provided him and made the decision to continue the current social distancing recommendations for another 30 days.

Do I think that Trump questioned the model they were basing their recommendations to him on?

I have no doubt about that. As I have written before, humanity has never wagered and spent more based on the output of a model. Trump knows that better than anyone. All that Trump is facing is clearly counter to his natural optimism. The decision also probably differed from his gut instincts of what is the right path forward.

However, Trump also knew that he would have no defense if he overruled the experts.

If he turned out to be wrong, he would certainly lose re-election. He would never be able to recover from it.

If he turned out to be right, and the experts were wrong, it goes without saying he would not get any credit from the media and a good portion of the electorate anyway. They would not give Trump credit for any decision he made that turned out right.

Therefore, Trump decided to follow the experts and embrace their dire forecasts. We were looking at 2 million deaths if we did nothing. We have to be perfect in our response to keep the death toll under 200,000 in the United States according to Dr. Birx.

In so doing Trump is following another principle that underlies the much different mentality that is present in The Fourth Turning crisis period I believe we are in.

In The Fourth Turning leaders assert public authority and demand private sacrifice. The very survival of society feels like it is at stake.

This is a quote from the book that I could not help thinking about as I heard the President extend his social distancing recommendations and more and more governors issue stay at home orders.

"Where leaders had once been inclined to alleviate societal pressures, they will now aggravate them to command the nation's attention."

What are we hearing every day now?

2 million deaths.

100,000-240,000 deaths if we do everything perfectly.

This is "life and death".

We are short 40,000 ventilators.

We need three times as many ICU beds as we have.

The Governor of Virginia announced yesterday that he was ordering a stay-at-home order in Virginia until June 10. Just one more example of all of this.

Everything is being done to aggravate the situation to command the public's attention.

There are no longer any gray areas. No one is trying to weave a solution that might exempt some areas within a state or within the country. No one is trying to permit business to continue but banning  mass gatherings or closing schools.

This is also what is typically seen in The Fourth Turning. Another quote from the book that I cannot get out of my head while I watch all of this unfold.

"Public issues will be newly simple, fitting the contours of crisp yes-no choices."

What are we hearing from our policy makers? There is no other choice. We need to close everything. It is the only way out of this.

Trump is no exception. He is following the script like everyone else. He really has no choice as I pointed out above. He is now saying the same thing to the American people.

I believe it will serve him well in the end.

We will survive the public health crisis.

My guess is that the numbers will be better than the models project.

Trump will be able to point to that success in the end.

Significant economic damage will be done and we will not recover from it soon. There will still be many unemployed by election day.

Democrats are going to want to lay that at the feet of Trump. Will they really being able to sell that?

I don't see how that works. I think that is especially true when you consider what the rest of the world is going to be dealing with at the same time. Make no mistake, if this is as bad as the modelers say it is the after-effects will be far and wide all over the world.

For example, I was struck with what Dr. Birx said at the press conference tonight. The United States had 5 times as many ventilators per capita in its hospitals as the UK did when this started. The U.S, had a national stockpile to supplement that number as well as manufacturers like Ford, GE and GM who have geared up to make ventilators. Where is the UK by November? Or the EU?

It is in trying times like these that people are most likely to want a strong leader. It is also clear that in the midst of trying times people are less likely to want to change leaders.

It would be easy to argue that Abraham Lincoln should have not won re-election in the midst of the Civil War. The same can be said of FDR in 1936 or 1940. Those were other Fourth Turning periods where the voters did not change course in the middle of trying times. People were already dealing with a lot of risk in their lives. Do they want to risk more with an unproven leader?

Considering where we are, and where we might be in 8 months, do you think that people are going to have more trust in 78-year old Joe Biden or 79-year old Bernie Sanders to lead us in these trying times than with Donald Trump?

I just don't see it and I don't believe it even though we see polls that are telling us that today.

The Democrats very likely will come to the same conclusion and try to bypass both Biden and Bernie in some type of political maneuver. They might solve the age and energy issues they have with those two with another candidate but will people be willing to risk their lives and livelihoods on hope and change? Will they trust someone in trying times that is unproven?

In May, 2016 I wrote a blog in which I raised the question of whether The Fourth Turning had brought us Trump? It was pretty far out there when I wrote it. At that time Trump had not even secured the GOP nomination. There were many in the Republican establishment who said they would never support Trump. He was way behind Hillary Clinton in the polls.

I closed that blog post this way. How little did I realize how prescient those words were. (By the way, that post stills ranks #3 in views of everything that I have written in over nine years of BeeLine)

"If The Fourth Turning has brought us Trump, can he lead us out of the Crisis? We can only hope. There are no promises. History is not made by events but by the reaction of human beings to events. We are hurtling down the road for a rendezvous with history of our own making. The choices that have been made and those that remain to be made will have deep consequences. We can only trust that the American people will make the right choice."

"In recent years, many Americans have despaired that their nation no longer produces leaders who can galvanize and inspire. Yet it is the turning, not the nation, that elevates great people to the apex of power. Lincoln and FDR are both cases in point. Both had to wait for the Crisis to hit. An Unraveling (the Third Turning) is an era when most people of intelligence, vision and integrity do not seek (much less get elected to) high public offices.
 After the Fourth Turning arrives, however, a Lincoln-like leader will be more likely to seek office, and a Lincoln-like leader could be exactly what America needs, wants and gets."

Credit: History News Network

"I know it is hard to imagine associating Donald Trump and Abraham Lincoln but that might be the bet we are making in 2016. We may need no less than a Lincoln with what lies ahead."

We can only pray that the bet that the American people did wager in 2016 was equal to that made in 1860. The stakes could not be higher.

There could not be much more on the line.

That should be clear to everyone now

Sunday, March 29, 2020

Models and Reality

If one thing is true right now it is that humanity has never wagered and spent more based on the output of a model.

We hear it every day from our policy makers.

"This is what the model is projecting". "This what the model is telling us". "This is what what we need to do according to the model".

I am a big believer in modeling. However, I am a bigger believer in reality.

In my last blog post I referenced the model that the Imperial College of London  had done which projected that the United States was facing 2.2 million deaths and the U.K. 500,000 deaths from Covid-19. The model estimated that even in a best-case scenario "there would still be in the order of 250,000 deaths in GB, and 1.1–1.2 million in the US.”

It was barely a week later that Neil Ferguson, who led the Imperial College study, admitted that his  model may have overestimated the number of potential deaths and the strain on the health care system from Covid-19. He revised the projected deaths down by 90%

Keep in mind that there was a 90% variation in the model's projection of deaths in the period of one week.

The website CovidActNow.org is doing its own model with the objective of pushing policymakers in various states to take stronger mitigation measures to combat the virus.

It has developed a graph for each state with the objective of urging state officials to ACT NOW.

 I live in Ohio but it is not clear to me what more that they want Ohio officials to do right now.

The schools are closed. Bars and restaurants are closed except for takeout and delivery. No public gatherings of more than 10 people are allowed. All non-essential businesses are closed. There doesn't appear to be too much more that can be done other than bolt everybody in their homes as was done in Wuhan, China.

In fact, that is the lockdown scenario that CovidActNow is using in its modeling as the preferred method to best deal with the virus. CovidActNow recommends that it last for 3 months. To put that in context, China is scaling back its lockdown in Wuhan now after two months. 

The model may say that. However, would there be a state of Ohio in existence at the end of a 3-month Wuhan-type lockdown?

This is the model for Ohio that is displayed on the CovidActNow website.

Over 100,000 projected hospitalizations compared to hospital capacity of 23,000 beds at the peak in mid-May according to the model. This is with Shelter in Place (worst case) in effect.

There are 403 hospitalizations right now in Ohio.

These are the projected outcomes according to the model. Note the range of deaths projected in the model for Shelter in Place which is the status we are in Ohio right now. They are also suggesting that all mitigation efforts must last three months.

7,000 to 174,000 deaths! I guess the range depends on how well people adhere to the shelter in place order.

Based on my experience in the past week in Ohio I think there is a pretty high compliance level regarding the shelter in place order.

The model CovidActNow is using must be very close to the model that Ohio government officials are following.

Ohio's most recent guidance is that they don't expect to see a peak in the number of cases until the middle of May. At that time they are suggesting that the state we will be seeing 10,000 new cases each day.  That timeline appears to match the CovidActNow model peak.

I must admit when I first heard that number it was hard to process it. I am not an expert epidemiologist or public health expert. I know that exponential infection rates are hard for the mind to process. However, I am a numbers guy and I have to tell you that at first glance that model does not pass the smell test to me.

I could be 100% wrong. This might prove to be the dumbest and most misinformed blog post I have ever written. However, let me give you are a few reasons that I question that conclusion.

Ohio currently has reported that it has run about 20,000 tests to date with about 5.6% of those being positive. In order to get to 10,000 new cases, based on the same positive test percentage, it would require nearly 180,000 tests to be performed per day. Perhaps the testing will get ramped up that much in six weeks. However, that is highly unlikely considering there were just 107,000 tests conducted across the entire country on Friday.

Moreover, as more tests are done it is likely that the percentage of positive results will decrease. Testing is now limited to people with symptoms. If you are at the point that 200,000 Ohioans a day are being tested the positive percentage should get smaller.

Let's put this in context. Doing 200,000 tests per day for one week in Ohio means that 12% of every person in Ohio (population of 11.4 million) would have been tested in that seven day period. I can't see that happening in the next month or so.

The other reasons I don't trust the model is that it does not seem to be consistent with the reality I am seeing around me in people's behavior. The model does also not track with the numbers that the Ohio Department of Public Health is publishing right now and the current infection spread that I calculate from the current trend.

Ohio's cases were growing at a rate of about 2.25x every three days right before the Governor first declared a state of emergency. It declined to about 1.9x right after the ban on large gatherings. It dropped to around 1.5x shortly after the schools, bars and restaurants were closed. Recently it is trending at about 1.25x after the shelter in place order took effect.

These are the state's reported numbers. They are revising some of the past numbers daily. However, this is the current reality. That is not a model. This is the trend in the growth of confirmed cases in the states.

Are we to expect that the case infection rate is going to increase even though all of these mitigation efforts are in place?

I guess the rate of cases could increase as more testing reveals more positive cases. However, any uptick in cases would seem to have to be short-lived as shelter in place lasts longer.

One fact that is now better understood seems to be that the incubation period of the virus is much shorter than first reported. More than half of people become symptomatic within 5 days. Almost 80% show symptoms within one week. There are some cases where the incubation period in up to 14 days or more but that now appears to be rare.

The WHO confirms this and is now saying that Covid-19 actually does not spread as quickly as the flu. Contrary to what we were told earlier, the WHO is also now stating that people infecting others before symptom onset "does not appear to be a major driver of transmission".

I took this screen capture right off the WHO website.

This would suggest that with isolating the sick, along the strong social distancing policies, we should see a demonstrable decrease in cases within 2-3 weeks. This clearly was the rationale that was behind the President's "15 Days to Stop the Spread" recommendations nationally. Of course, states like Ohio, New York and California took that a step further and put shelter in place policies in place that should show even stronger benefits in slowing the spread.

This graph should give some indication that people are following the guidance.

Traffic accidents in Los Angeles.

Credit: https://twitter.com/benconomics/status/1243268711525408769/photo/1

I would imagine if you could graph people's interactions it would look a lot like that graph above.
Where does the infection spread if the number of human interactions and exposures has been curtailed so severely?

The early data that Ohio is reporting seems to back that up. What I don't understand is how these models assume that the spread of the virus is going to worsen despite these measures.

We are even seeing some slight improvement in the case numbers in New York on this measure.

The day before bars and restaurants were closed in New York City the 3-day growth rate was over 4x. The last couple days that number has declined to the 1.7x range.

The other reality is this one.

3.3 million new claims for unemployment filed for in the last week alone.

This graph puts those claims in perspective. The Great Depression never saw anything close to this in one week's time.

I guess you could say that another reality is that the only thing spreading faster than Covid-19 in the models is the unemployment rate.

Here are the unemployment claims filed in Ohio for the week. 188,000 in claims.

Credit: New York Times

Compare that to California with 186,000 claims.

Credit: New York Times

And New York with 80,000.

Credit: New York Times

What does that tell me?

New York and California are much bigger states and the stricter containment measures in these states followed Ohio by a few days. We have not come close to the unemployment numbers we are going to see from these and other states in the coming days.

It would not surprise me to see the unemployment claims released this week be another 3 million (or more).

All of this based on a model?

That is our reality.

Will we ever know whether the biggest wager that humanity has ever placed on a model was worth the cost?

Another reality is that long after this is over we will likely still not know the real truth of whether what we have been through was worth the sacrifice and costs.

The modelers will tell us that their models saved us from the drastic effects that the virus would have had on human life.

Skeptics will argue that the virus was never as bad as advertised to begin with.

In the meantime, every American (and most of the rest of the world) is in a new reality that few were prepared for.

The models don't mean much to them. However, the actions that policymakers are making based on those models mean everything.

This 1994 film title says it all for almost everyone right now. The 2020 version is certainly no love story.

May we have wise and discerning leaders who understand both models and reality.

Thursday, March 26, 2020

Follow The Science

We often hear that we need to "follow the science." This is particularly popular with Liberals as they attempt to push their climate change and Green New Deal agenda. They like to tell us that we can't ignore "the consensus of scientists".

However, what if the consensus of scientists is wrong?

One of the most popular blog posts I have ever written was "Consensus Is Not Science". In that post I wrote about the the so-called "consensus" of scientists that climate change was settled science.

When it comes to settled science, there is no doubt that we have climate change. It changes every hour, every day and every year. It has changed over the centuries.

The question is not whether it is changing but whether man is impacting that change and, even if that is the case, whether we can even do anything about it?

Whenever we hear about the "science" of human related climate change there is nothing "settled" about it. That is why we hear that this view is supported by the "consensus" of scientists.

Of course, "consensus" is not the same as facts. And consensus is not a scientific fact. A scientific fact is the law of gravity, the boiling point of water or the distance to the moon. 

Prior to the 15th century, the consensus of scientists was that the earth was the center of the universe.

In the 18th century, the consensus of medical scientists was that blood letting was the best method to cure illness.

As recently as 25 years ago the consensus was that peptic ulcers were caused by stress. We now know it is caused by bacteria.

I could go on and on. In fact, in most cases like these, the consensus of scientists was proven wrong by one person who did not believe the consensus and proved it wrong.

Why do I bring this up now?

We are starting to hear the same "follow the science" mantra from those on the left who are questioning President Trump in his statement that we may soon be loosening some of the nation-wide restrictions imposed to counter the Covid-19 epidemic.

This Joe Biden tweet from today is proof of that.

Never mind that President Trump is merely doing what we should expect our national leader to do. Balancing the public health and economic costs in this crisis in his decision making.

Why does that make sense?

One big reason is that the "consensus of scientists" has changed a great deal in several months regarding Covid-19.

For example. the World Health Organization (WHO) is the recognized global authority on public health issues.

Let's take a look at how the WHO scientists have evolved in their view of "the science" over time.

As late as January 12 the WHO was stating that there was "no clear evidence of human to human transmission" regarding the virus.

On February 3, in response to the travel ban that President Trump initiated with China on January 31, the WHO stated "there is no need to restrict travel in order to slow the spread."

That was supposedly the best "science" at the time.

Of course, by the middle of March the WHO was stating that "this is a pandemic" and it was "deeply concerned by world leaders' inaction."

We can also look at the study published on March 16 by Imperial College in London that predicted that millions were going to die in the United States and the UK from the virus even in a best case scenario with extensive mitigation efforts in place like we are seeing now.

A study published Monday by the Imperial College, a public research university in London, estimates that millions will die from the coronavirus pandemic in the United Kingdom and United States. In their best-case scenario, in which transmission of the virus is massively mitigated, and “even if all patients were able to be treated,” the authors write, “we predict there would still be in the order of 250,000 deaths in GB, and 1.1–1.2 million in the US.”

That "science" was massively influential in changing the UK response to Covid-19. It also clearly pushed New York and other states in the United States, who had been resisting stronger measures, to move to "stay at home" or "shelter in place" orders.

That was the "science."

However, today we find the "science" has changed.

Neil Ferguson, who led the Imperial College study, testified before Parliament yesterday that his  model may have overestimated the number of potential deaths and the strain on the health care system from Covid-19.

The UK should now be able to cope with the spread of the Covid-19 virus, according to one of the epidemiologists advising the government.
Neil Ferguson at Imperial College London gave evidence today to the UK’s parliamentary select committee on science and technology as part of an inquiry into the nation’s response to the coronavirus outbreak.
He said that expected increases in National Health Service capacity and ongoing restrictions to people’s movements make him “reasonably confident” the health service can cope when the predicted peak of the epidemic arrives in two or three weeks. UK deaths from the disease are now unlikely to exceed 20,000, he said, and could be much lower.

Keep in mind that one week ago Ferguson was stating that the "science" indicated that 250,000 would die in the UK and the health system would be overwhelmed. That was the "best case scenario". That was not the worst case.

Yesterday Ferguson stated that the "science" is now that hospitals have the capacity to deal with the problem and deaths were unlikely to exceed 20,000 and could be much lower.

In one week "the science" is showing a variation of 90%?

Is this the "science" that Joe Biden wants us to follow?

You also have to ask if scientists can be this far off in models over a one week period how is it that we are supposed to believe hypothetical climate models that are trying to forecast events years and years in the future. They also want us to spend tens of trillions of dollars to avoid a fate that is complete conjecture.

Follow the science?

I am much more confident in following our leader right now.

I have not seen anything to indicate that President Trump is not considering and balancing the science, the economy and what is best for the American people in the short and long term in all the decisions he is making.

If you want another perspective on the "science" you might want to view this 10-minute video of a German pulmonologist ,Dr. Wolfgang Wodarg, who has a lot of experience with respiratory viruses in his career.

His view of the Covid-19 crisis is that it is an example of the scientists and virologists getting the attention of the government and politicians such that the hype has vastly exceeded the virological frame that should have surrounded it. He says this would have never been considered anything extraordinary if it had not crossed into the political and media realm.  He is not seeing anything much different than he did in any flu season in his career.

Wodarg makes the point that each year coronaviruses generally have made up 7-15% of respiratory viruses. Interestingly, the testing that has been done so far nationally (over 400,000 cases) is running right around that percentage range in testing of those with symptoms in the United States.

The doctor says that the problem now is that it is very difficult for any scientist or virologist to not be in the mainstream. The king may not have any clothes on but no one wants to admit it at this point.

Check it out and make up your own mind where the science is on this.

All of this leads to the question ...which "science" are we supposed to follow?

Wednesday, March 25, 2020

A Lot Can Happen In One Month

The entire country is in the middle of a 15-day national "Slow the Spread" campaign in which Americans are being asked to take extraordinary social distancing measures to slow the spread of Covid-19 across the country.

These national recommendations by the President have been supplemented by various measures by the nation's Governors. All the information below can be found at kff.org.

Schools are effectively closed across the nation.

In 43 states, bars and restaurants are closed except for take-out and delivery service.

Large gatherings are limited in 40 states.

Non-essential business have been ordered closed in 22 states.

13 states are on state-wide mandatory quarantines. Another 8 have this measure in effect for certain counties or for high-risk groups. These states account for almost 50% of the population of the United States.

Covid-19 cases continue to grow across the United States.

As of today, there were over 66,000 cases in the country of which over 11,000 were confirmed in the last 24 hours.

Governor Cuomo just announced new totals that show New York cases are now almost 31,000.

Let's look where these cases are in New York state.

98.7% of all the cases in New York state are in 7 counties in and around New York City.

Consider that New York now has 15 times the number of cases in either California or Washington.

The counties in other states bordering New York City are in the Covid-19 epicenter.

New Jersey is now the state that has the second highest number of cases---4,402 as of today. Two-thirds of cases in New Jersey are coming from those counties considered to be in the New York Metro area.

90% of the cases in Connecticut are in the three counties considered to be in the New York City metro area in the map above.

Looking at the numbers above, what that really means is that the New York City metro area has more cases than the rest of the country combined. In fact, almost 60% of all the cases in the United States are within the confines of that map above.

Looking at this data it is becoming increasingly apparent that this is a public health crisis in the New York City metro but it is a public health concern in a good part of the rest of the country.

Source: kff.org

Why did this happen?

A big reason is the New York authorities were much too slow to take action against the spread of the virus.

Governor Andrew Cuomo is the new darling of the Democrat party based on his daily press conference and his "straight-talk" on the crisis. Some have even suggested that Democrats might turn to Cuomo should Biden stumble or prove incapable to serve as President between now and the election.

In fact, Cuomo is now being given a better chance to be the Democrat nominee for President than Bernie Sanders according to the PredicitIt betting market.

Cuomo is doing a good job right now in responding to the crisis. However, what we are seeing in the New York City metro area is a direct result of earlier inaction by Governor Cuomo and New York City Mayor DeBlasio who did not take the threat serious enough earlier.

For example, here is a tweet by DeBlasio on March 2 where he tells New Yorkers to get on with their lives and get out on the town.

Here is DeBlasio's Health Commissioner urging people to participate in the Chinese New Year parade and celebration at the same time the virus was raging in China and 10 days after President Trump had banned travel from China. She tells people to not change any plans due to "misinformation" spreading about coronavirus.

Something was clearly spreading and it was not misinformation.

I wrote previously about the actions Governor Mike Dewine took in Ohio beginning on March 9. Dewine declared a state of emergency on the same day when Ohio announced its first three cases of coronavirus. He urged all state universities go to online classes. He declared that all large gatherings were banned.

On March 12 Dewine announced that all schools statewide should close. He instructed all college students to return home.

By March 15 all bars and restaurants were ordered closed except for take-out and delivery orders.

On March 22 Dewine issued a state-wide stay at home order for all but employees and businesses involved in essential services.

During that 7-10 day period a number of other states followed the lead of Dewine in Ohio.

One that did not was Andrew Cuomo. Bill DeBlasio also was slow to act.

In fact, it was not until March 17 that Mayor DeBlasio first mentioned the possibility that New York City might have to consider a "shelter in place" order.

Even worse, Cuomo rejected the idea as out of hand. This is from a headline from NY magazine on March 18.

On Tuesday, Mayor Bill de Blasio announced he was considering a shelter-in-place order for New York City, and that he would make the determination in the next 48 hours. The order, if implemented, would restrict New Yorkers from leaving their homes “except for essential needs,” like shopping for food and visiting health-care providers.
Apparently, New York governor Andrew Cuomo didn’t take the possibility seriously at all. “Any blanket quarantine or shelter in place policy would require State action and as the Governor has said, there is no consideration of that for any locality at this time,” a statement from Cuomo’s office read.

Give credit to DeBlasio for being ahead of Cuomo on this one but DeBlasio dragged his feet for a long time on closing New York City schools. He was refusing to close New York City schools as late as March 14.

It is clear now that New York City should have been taking the actions they finally undertook at least a month ago.

That is especially true considering that the New York City metro area is such an international travel hub.

In Cuomo's press conference today he asked the rhetorical question as to why New York has 15 times the number of cases as any other state. He said it was his personal opinion it was due to,

1) the density of the population and the close proximity that people had with others.
2) the fact that New York was an international travel hub.

I agree with those conclusions. However, those were well known before this epidemic started. It would seem that Cuomo and his public health officials should have been extra vigilant and proactive knowing these obvious facts. New York was more vulnerable to a virus that comes from abroad than any other area due to these factors.

Where was Cuomo when Trump announced the China travel ban? I could not find any mention where Cuomo or DeBlasio supported the President at the time when so many other Democrats and members of the media were criticizing Trump. That bipartisan support would have meant a lot. You can bet that political correctness had a lot to do with it.

Why have they also been strong supporters of sanctuary city status for New York knowing the obvious vulnerabilities that New York City has and that Cuomo openly acknowledged today?

What were Cuomo and DeBlasio focused on in February?

They were both fighting with Trump because the federal government was no longer going to allow New York residents to enroll in the Global Entry program that expedites people through U.S. Customs because the state had started giving driver's licenses to illegal aliens.

Source: New York Globe

Source: USA Today

We can see now that the China travel ban probably has had a lot to do with the lower number of cases on the West Coast. It cut off the seeding of more cases early into Washington and California that sees more air travel from Asia. However, flights from China still continued to Europe and Iran. The virus found another way to get into the country and New York City was the best target.

As I have written before, the criticism Trump took over China is probably a big reason that he did not move quicker on stopping European flights. I was of the view that Trump should have stopped those flights several weeks earlier. That was his biggest mistake in all of this in my opinion.

Where were Andrew Cuomo and Bill DeBlasio in calling for stopping the flights from Europe during February knowing New York was exposed as that international travel hub? They should have been calling for Trump to ban the flights at that time. Why did they not lobby for that action to be taken?

Everything in New York is now a reactive response and it is all playing catch-up.

Where do things go from here?

I believe that there is almost no choice other than to lock down the New York City metro from the rest of the country. Flights need to be stopped in and out. Trains, buses and other public transportation that brings people in or out of the metro area need to also cease. A ban on all personal and non-essential travel in and out of the area may also be necessary if the numbers don't start dropping.

At this point it will do no good for Ohio or Nevada or Florida to go through extreme measures for several weeks to stop the spread only to have people from the most affected area in the country bring new cases of the virus in.

The problem is that many people in the New York area have already left the metro area to avoid the shutdown. Drs. Fauci and Birx have told anyone who has been in the New York City area and gone somewhere else the last couple of weeks to self-quarantine where they are so as not to seed more cases elsewhere. Whether people do that will have a lot to do with whether more extreme measures will have to be taken.

Governor Cuomo is warning other parts of the country that their turn is coming. In another month it could be them. He is correct. That can happen. However, a lot of that will depend on how well New York curbs the epidemic locally and how well we contain people from that area infecting the rest of the country.

Unfortunately, Cuomo should have been thinking more about all of this a month ago.

I remain optimistic that we are going to get through this and it will be quicker than most people would predict right now.

I think states like Ohio might be weeks away from getting most of their lives back. We may not see MLB baseball for awhile. At-risk individuals may need to isolate themselves. There may not be a Memorial Day parade this year. We should see results soon from the actions that have been taken.

However, it will be months before New Yorkers will. How long? I don't know.

Let me put it this way for you golf fans.

I think there is a fair chance that the Memorial Tournament will be played in Dublin, Ohio beginning June 4.

I think the chances are almost zero that the U.S. Open will be played in Mamaroneck, New York beginning June 18.

Stay tuned.

A lot can happen in one month.

We all should understand that now.

It would have been nice if Andrew Cuomo and Bill DeBlasio would have understood that one month ago.

Monday, March 23, 2020

Covid-19 by the Numbers

One of the interesting things about the Covid-19 pandemic is that it is not only a health care challenge but it is also a numbers game.

I am a numbers guy so I have found myself most interested in examining the numbers surrounding the Covid-19 virus.

Pandemics are caused by a compound number of infections occurring over larger and larger geographic areas. They only end when the compounding number of cases can be stopped.

There are two key numbers in any pandemic situation.

The infection rate. In other words, how many people will typically be infected by one person with the virus? This is also referred to by public health experts as the R0.

The mortality rate. What percentage of those infected will succumb to the disease?

One of the unknowns about Covid-19 is that we don't know either of these numbers with certainty. It is a new virus and there is not enough data right now.

The best estimate is that it is 1.5x-3.5x more contagious than the seasonal flu.

It is also 3x to 12x more deadly than the seasonal flu.

This graph shows where it is believed that Covid-19 falls on those measures compared to other high profile communicable diseases. For example, the seasonal flu only has a fatality rate of .10%. That means 1 in 1,000 who contract the virus will die because of it.  Covid-19 might be 1%---10 times greater.

These unknowns are a big reason why public health officials are erring on the side of caution right now. The data thus far does show that the hospitalization and mortality rate are undoubtedly higher than the seasonal flu. How much higher is the big question right now.

What has also made the numbers challenging to analyze with Covid-19 is the lack of broad testing.

The media and others have tried to make a big deal of the failure to get enough test kits and testing sites out in the public to determine the true amount of Covid-19 in the community.

However, the reality is that there is generally very little testing done with the seasonal flu compared to those infected. Those tests kits also could not be used for Covid-19 as it was an entirely new strain.

For example, the CDC is currently estimating that there have been 38 million cases of the seasonal flu this year but only about 270,000 of those have been confirmed by testing. About 1.2 million tests were conducted with around 22.5% showing positive tests for the flu. In other words, less than 1% of all cased of the flu are confirmed by a test. Most people realize they are sick, rest and recover at home and are never tested. Of the most severe cases, there have been 390,000 hospitalizations and 23,000 deaths so far this season.

This year has been a particularly brutal flu season even without accounting for Covid-19. My personal physician recently sent me a letter in which he stated this is the worst influenza season he has seen in 28 years of practice.

This is the CDC graph comparing hospitalizations from the flu compared to other recent years.

Source: CDC

This may also further explain the pressure on the hospital system in some parts of the country as we are dealing with Covid-19 in addition to a higher than normal seasonal flu. It also may be the case that doctors like my own have been seeing Covid-19 mixed in with regular flu cases all along. We won't know until more testing is done. That includes an eventual antibody test that will tell us just how many people have been exposed to the virus in the population.

When you put the entire testing situation in context I think it is rather remarkable how quickly the test numbers have been ramped up considering there really weren't millions of test kits sitting on the shelf when it began. After all, how could there be a reliable test if it was a new strain of virus that only surfaced in the last several months?

There also seems to be no doubt that the large increase in confirmed cases right now is being driven more by increased testing than anything else.

Here are the number of Covid-19 tests that have been administered and reported since President Trump was able to create the public-private partnership with commercial labs and not rely on the CDC and state public health agencies for testing. It should be noted that not all labs are reporting all tests into the database right now. However, those that are have found a pretty consistent 10% positive rate for all those tested (note the exception for New York mentioned below.)

This is what the Surgeon General said about the number of tests, and what they mean, over the weekend on Twitter.

This is another interesting graph that compares the number of tests in various countries in the world compared to the number of confirmed cases. It is based on data from a few days ago but I found it interesting in how there seems to be a pretty consistent pattern of finding that the number of confirmed cases group pretty close to the line I drew onto the graph that represents a 10% Covid-19 infection rate among those tested.

It probably should not be a surprise that the countries that deviate most favorably from that line (Russia, Australia, South Korea) have done the most tests.

Again, this is several days ago and the United States testing is accelerating quickly. The most recent test numbers for the United States are now over 280,000 according to the source I used above. (VP Pence stated at the press conference tonight that the test results processed is actually at 313,000.)

Test numbers are now increasing by at least 50,000 per day and the Surgeon General believes that 100,000 is possible. At that rate the United States is going to surpass South Korea in total testing within the next week and in two weeks it could be close to South Korea's test totals on a population adjusted basis.

A key metric as testing continues to expand within the population is whether we begin to see the positive tests as a percentage of total tests fall below 10%. This would tell me that we are making progress. However, there is a long way to go in achieving that number in New York which Dr. Deborah Birx stated tonight is currently seeing a 28% positive rate from testing. The rest of the country is testing positive at 8%.

That tells me that we are going to see more stringent measures in the New York area. It is difficult to see how any flights or any but the most essential travel should be going on between New York and other parts of the country right now.

The number that is still the most important in all of this is the number of deaths. We might not get all the data on the number of tests. We clearly may never know (just like the seasonal flu) exactly how many total cases there have been. However, the number of deaths should be a pretty definitive number.

However, even that is not easy. To really understand how dangerous Covid-19 is we need to determine exactly what the excess mortality is. Yes, someone could have died and tested positive for the virus but they could have also died from the seasonal flu or something else. It is the excess mortality that we really need to identify.

I have been trying to analyze this angle but I cannot find any reliable numbers to put this in the proper context.

For example, we now know that no country has had more deaths than Italy from the virus. Over the last several days Italy has been seeing an average of over 600 deaths per day attributed to Covid-19.

However, what does this mean without knowing what "normal" is?

Italy's population is approximately 60 million people. Last year it had 634,000 deaths. In 2020, before this pandemic began, it was projected to have 640,000 deaths for the year. That is an average of 1,753 per day. However, we know that deaths in all countries tend to increase in the winter season.

For example, here is a graph that shows the seasonality in the number of deaths in the United States for 2017 when deaths averaged 7,708/day for the entire year. However, during the winter months deaths averaged about 8,400---9% more.

Source: CDC

If we apply that same percentage to Italy, we would expect around 1,900 deaths under normal circumstances. They are attributing 600 deaths to Covid-19. That is a large percentage of the normal rate of 1,900. However, is that really excess mortality?

If Italy's total deaths right now are running 2,500 per day then this is as serious as it can be. That is a number that is over 30% higher than normal.

However, what if total deaths are 2,000 per day? This would suggest that excess mortality is only about 100 per day. This would only be a 5% increase over the normal daily average.

It seems to me that the excess mortality number is the most important data point in all of this. It is especially important as the President and others have to look more critically this week at the trade-off between our public health and our economic health.

Perhaps total deaths is not a number that we have routinely collected or monitored on a daily basis across the United States. It probably is a number than gets reported from death certificates in the various states on a monthly basis to the CDC.

Even if we have the number on a daily basis it probably lags a couple days compared to deaths because of the lag in getting the death certificate signed and filed.

However, I am a numbers guy. I think President Trump is one as well.

If I was sitting in his chair I would be demanding to see the total death numbers across the United States every day and compare it to the numbers that were projected before all of this started in order to determine the excess mortality number from Covid-19 in real time.

We need better data than what I am seeing. I would also not want to get this number a year from now and find out we destroyed the economy by not having the right data when we needed it.

I don't see any other way to really assess where we are and what our next steps should be as a nation to combat the virus.

The worst thing we could have done in this situation is to not take it seriously.

What is the next worst thing? We took it way too seriously when the data later shows we vastly overreacted.

Excess mortality numbers in real time would help insure that doesn't occur.

Saturday, March 21, 2020

Looking Over The Cliff

On January 30, just as the reality of what the impacts of the coronavirus on China were becoming known, I commented that the economic impacts of the virus could very well be more contagious than the virus itself.

This was based on observing the extraordinary measures the Chinese government took in shutting down human and economic activity to combat the virus.

As we saw the virus escape China and start spreading around the world, we saw the economic impact playing out more and more, even before government entities got directly involved.

I wrote this on March 2.

We have already seen international air travel drop dramatically. I would expect that we will soon see the same in domestic air travel. I would expect restaurants, bars, theaters and other venues that host large numbers of people around Seattle, and in places in California where cases have been identified, will see precipitous drops in business. Retail shops will also suffer except for grocery stores which may struggle to keep their shelves full due to panic buying.
We may see this story unfold across this country if the virus cannot be contained. It may get very, very ugly before it gets better. Most people will survive the virus. It is an open question how many will survive the potential economic fallout.

Of course, that is exactly where we are right now.

There is no question that most everyone will survive Covid-19.

The question now is how many will survive the economic impacts that will follow the drastic measures that have been implemented by authorities to combat the measure.

Will we discover in the end that the cure was really much more deadly than the disease?

In my view, this is the week that we really need to look over the cliff at the possibilities.

I have stated previously that I believe the measures that President Trump and his task force team recommended for the 15-day period we are in makes sense.

I think the economy can survive and rebound from that shock. We will have sustained some damage but it is the type of thing we can bounce back from. People and businesses may have had to take off from work or closed for this amount of time previously and been able to withstand the disruption. There is some margin in their lives or business to deal with a couple weeks like this. After all, people take vacation time. Some businesses close for the same reason or to remodel or retool.

However, it seems to me that every day beyond that point the longer term risk to our economy will grow exponentially. I have to think that the human costs from that exponential risk will soon be greater than the human costs of the disease.

A virus like Covid-19 becomes more deadly because of the compounding effects it has on a population. We have seen that all over the world.

However, an economy unravels through compounding effects as well. Customers don't come to a restaurant or store. The owner has to lay off her employees. The owner eventually can't pay their rent. The property owner can't pay the loan on the building. The bank ends up with a bad loan. Everyone then cuts back on their own spending. Tax revenues to the government fall. Government services need to be increased. Large fiscal deficits occur. The cycle continues as the compounding continues.

A point is reached at which you have fallen so far into the abyss it is next to impossible to climb out.

We are looking over the cliff right now.

For example, one analyst recently estimated that having 50% of the economy shut down equates to a annualized loss of GDP of 1% per week. Since our economy has only been expanding in the range of 2%-3% per year, at the end of this two week period we could have already effectively wiped out an entire year of economic growth.

This analyst might actually be optimistic.

Here is the headline on the most recent forecast by Goldman Sachs of the economic effects we are looking at.


Goldman Sachs sees a long, slow ride back as shown in the graph below.

If you can't process what is over the cliff let's look at some data from China that indicates that both numbers above may be optimistic.

This shows an index that generally tracks China's business services economy that I found on Zero Hedge. The graph goes through the end of February.

Here is graph showing the broader composite index for economic activity in China.

Deutsche Bank forecasts that China's economy will shrink by 31.7% overall in the first quarter.

Let's look at something that is a little easier to grasp for a specific industry we are all familiar with.

Credit: Zero Hedge

China auto sales were down 79% in the month of February.

Credit: Zero Hedge

Speaking of compound effects, if there are no auto sales at the dealership there is no need to manufacture cars and trucks for a period of time. There is no need for the parts that go into those vehicles. There is no need for the trucks that deliver the parts or assembled cars. There is no need for the gasoline that fuels the trucks. The compounding continues far and wide much like a virus spreads through the population.

So much will be affected as time goes from what is happening now and the next few weeks.

This past week my dentist contacted me to say she was shutting down her practice for several weeks. That means no money coming in for her and her staff. I have heard that the ADA has recommended that all dental practices close.

My doctor's office called to say they were postponing all routine visits so as to have capacity for flu cases and Covid-19.

Someone was at Home Depot and they said residential contractors have seen their business evaporate because no one wants anyone in their home.

At the same time, interior paint sales are surging as a lot of people are tackling home projects that they didn't have time for before.

Look at this graph that shows the drop-off in New York City subway usage.

With the virtual shutdown of New York now taking effect, the coming week's numbers will be even worse.

There are cliffs everywhere we look.

Make no mistake, business was going to suffer even without any direct government action due to the public's concern about Covid-19 in the first place. Under the best of circumstances it is going to take time for people to regain their confidence in human interactions and commerce.

However, over the next week or so government is going to have to be looking over the cliff and make a judgment of whether the cure that has been prescribed by our authorities might actually be worse than the disease.

Expect to see more questions about this with every succeeding day.

More difficult days...and decisions...are ahead.