Coronavirus

[Dalal.Holdings]

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

Well at least you admit it. This was not a low stakes issue which is why I questioned your level of confidence. When people become confident in such things, the danger is that precaution is thrown aside.

 

When leaders dismiss precaution and instead exhibit confidence that “the virus will be gone soon” or “a vaccine will be here soon”, the cost of them being wrong—economically and in terms of lives lost—is massive and will be borne by society...

 

The Asian countries and some others like NZ seem to get the precautionary principle. Others not so much.

[DocSnowball]

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

Well at least you admit it. This was not a low stakes issue which is why I questioned your level of confidence. When people become confident in such things, the danger is that precaution is thrown aside.

 

When leaders dismiss precaution and instead exhibit confidence that “the virus will be gone soon” or “a vaccine will be here soon”, the cost of them being wrong—economically and in terms of lives lost—is massive and will be borne by society...

 

The Asian countries and some others like NZ seem to get the precautionary principle. Others not so much.

 

Let's for a moment assume the herd immunity thesis is broken (we don't know that yet). You're not the only one holding it, there are plenty of others who will realize this as cases and hospitalizations go up, and we anticipate they could go up fast. My question is, can one make money from this understanding? If yes, where are the opportunities to make money if a significant third wave hits?

 

Edit: this question is based on the realization that cases and markets have not correlated much in the last 6 months

[Dalal.Holdings]

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

Well at least you admit it. This was not a low stakes issue which is why I questioned your level of confidence. When people become confident in such things, the danger is that precaution is thrown aside.

 

When leaders dismiss precaution and instead exhibit confidence that “the virus will be gone soon” or “a vaccine will be here soon”, the cost of them being wrong—economically and in terms of lives lost—is massive and will be borne by society...

 

The Asian countries and some others like NZ seem to get the precautionary principle. Others not so much.

 

Let's for a moment assume the herd immunity thesis is broken (we don't know that yet). You're not the only one holding it, there are plenty of others who will realize this as cases and hospitalizations go up, and we anticipate they could go up fast. My question is, can one make money from this understanding? If yes, where are the opportunities to make money if a significant third wave hits?

 

Edit: this question is based on the realization that cases and markets have not correlated much in the last 6 months

 

These days, the way to make money is: bad news -> stimulus -> stonks go up (and even good news as long as fed doesn’t tighten)

 

The virus has gotten less deadly as we’ve matured our treatment modalities: proning, remdesivir, antibody cocktails, steroids, avoiding things that don’t work (HCQ,etc) but a third wave would drive a population already conditioned to a deadlier covid to reduce consumption/activity. And having a virus that can kill your relatives and/or spending time in the ICU/hospital with a respiratory virus is not exactly enticing even if you survive.

 

So while stonks may go up, the fear is that the real economy will get hit.

 

As they say, an ounce of prevention is worth....but it’s too late now for that anyway.

[muscleman]

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

Well at least you admit it. This was not a low stakes issue which is why I questioned your level of confidence. When people become confident in such things, the danger is that precaution is thrown aside.

 

When leaders dismiss precaution and instead exhibit confidence that “the virus will be gone soon” or “a vaccine will be here soon”, the cost of them being wrong—economically and in terms of lives lost—is massive and will be borne by society...

 

The Asian countries and some others like NZ seem to get the precautionary principle. Others not so much.

 

Let's for a moment assume the herd immunity thesis is broken (we don't know that yet). You're not the only one holding it, there are plenty of others who will realize this as cases and hospitalizations go up, and we anticipate they could go up fast. My question is, can one make money from this understanding? If yes, where are the opportunities to make money if a significant third wave hits?

 

Edit: this question is based on the realization that cases and markets have not correlated much in the last 6 months

 

I think I said this before. Climbing cases is a bullish thing for the stock market. The way to make money from it is to buy stocks not sell short stocks or stay in cash and whining.

I think reopening plays are great buys because even though the cases are spiking, I don't think another lockdown will happen. Businesses will remain open while we go through the 3rd wave.

I see reopening play stocks with reasonable valuation and growing revenue during the pandemic and I expect them to do well now that lockdowns are easing.

[muscleman]

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

Well at least you admit it. This was not a low stakes issue which is why I questioned your level of confidence. When people become confident in such things, the danger is that precaution is thrown aside.

 

When leaders dismiss precaution and instead exhibit confidence that “the virus will be gone soon” or “a vaccine will be here soon”, the cost of them being wrong—economically and in terms of lives lost—is massive and will be borne by society...

 

The Asian countries and some others like NZ seem to get the precautionary principle. Others not so much.

 

I am in constant search for truth, with no political agenda. It is important to have high conviction when betting but always keep an open mind if wrong. That's the best mentality for an investor.

 

As George Soros said, you can be wrong a lot of times but still make right market calls, and people who were unwilling to make calls until they are super confident are wrong most of the time about the market.

 

Over the years I found out that it is important to be just a little smarter than the average. If I got two steps smarter, I could not make any money because the market cannot see that far.

 

[Spekulatius]

That about sums it up:

https://www.cnbc.com/2020/10/23/fauci-says-trump-hasnt-attended-white-house-coronavirus-task-force-meeting-in-several-months.html

 

Fauci says Trump hasn’t attended White House coronavirus task force meeting in ‘several months’

[Spekulatius]

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

Well at least you admit it. This was not a low stakes issue which is why I questioned your level of confidence. When people become confident in such things, the danger is that precaution is thrown aside.

 

When leaders dismiss precaution and instead exhibit confidence that “the virus will be gone soon” or “a vaccine will be here soon”, the cost of them being wrong—economically and in terms of lives lost—is massive and will be borne by society...

 

The Asian countries and some others like NZ seem to get the precautionary principle. Others not so much.

 

Let's for a moment assume the herd immunity thesis is broken (we don't know that yet). You're not the only one holding it, there are plenty of others who will realize this as cases and hospitalizations go up, and we anticipate they could go up fast. My question is, can one make money from this understanding? If yes, where are the opportunities to make money if a significant third wave hits?

 

Edit: this question is based on the realization that cases and markets have not correlated much in the last 6 months

 

These days, the way to make money is: bad news -> stimulus -> stonks go up (and even good news as long as fed doesn’t tighten)

 

The virus has gotten less deadly as we’ve matured our treatment modalities: proning, remdesivir, antibody cocktails, steroids, avoiding things that don’t work (HCQ,etc) but a third wave would drive a population already conditioned to a deadlier covid to reduce consumption/activity. And having a virus that can kill your relatives and/or spending time in the ICU/hospital with a respiratory virus is not exactly enticing even if you survive.

 

So while stonks may go up, the fear is that the real economy will get hit.

 

As they say, an ounce of prevention is worth....but it’s too late now for that anyway.

I agree on the importance of stimulus - it’s is more important than the outcome of the election. As Long as the WFH plays do well, the general stock Market will do well too, especially QQQ, even if a lot of other sectors are ailing.

[Investor20]

No worries, we've had "herd immunity" since the end of August...you just have to change the definition of "herd immunity" (it's the new moving of the goalposts, bro!)

 

Meanwhile, NZ shows what it looks like to actually "be tired of winning":

 

 

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

 

The antibodies are lasting only few months.  I early posted NYC antibody data and some here wouldnt agree that present 20% seroprevalence does not mean only 20% got infected.  Instead the infection rate was much higher than present seroprevalence numbers indicate.  Now there is Mumbai seroprevalence also showing waning:

 

"The second serosurvey revealed that the prevalence of the novel coronavirus in slum areas had reduced to 45 per cent from the 57 per cent reported in the first round."

https://www.freepressjournal.in/mumbai/coronavirus-in-mumbai-antibodies-up-2-among-residents-of-housing-societies

 

The antibodies are waning in few months for many people.

 

The other immunity is T Cell immunity but my understanding is T Cell immunity only reduces severity of the disease.

 

"The authors say that memory T cell responses generated by natural exposure to or infection with severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) -- the virus that causes COVID-19 -- may be a significant immune component to prevent recurrent episodes of severe disease."

https://www.sciencedaily.com/releases/2020/08/200817132331.htm

 

As I understand from the Barrington declaration, the herd immunity is not meant to be zero infections, rather Covid will become an endemic like a flu.  Even with vaccine, the flu has not disappeared.  The Covid 19 along with  flu vaccine beginning of winter will prevent infections for sometime and our T Cell immunity will make it less severe.

 

This is my understanding till now....that herd immunity for Covid only means endemic Covid 19. See below interview with Dr. Bhattacharya way back in July 30.

 

"They got unimmune, is that a word, unimmune at different times. And so you’ll start to see like this endemic thing. And I mean, that’s what herd immunity looks like. It doesn’t look like zero infections. It looks like this thing. That’s just sort of, endemics floating around all the time. And that’s why you’d have to protect the older population for a long time."

https://techpolicyinstitute.org/2020/07/30/jay-bhattacharya-on-health-economics-and-coronavirus-two-think-minimum/

 

 

[Investor20]

Below is not a treatment advise.  Just for discussion.

 

I am puzzled at Remdesivir approval by FDA.  Looking at the label, the clinical studies they cited from Page 19:

https://www.accessdata.fda.gov/drugsatfda_docs/label/2020/214787Orig1s000lbl.pdf

 

NIAID ACTT-1 Study in Subjects with Mild/Moderate and Severe COVID-19:

A randomized, double-blind, placebo-controlled clinical trial (ACTT-1, NCT04280705) of hospitalized adult subjects with confirmed SARS-CoV-2 infection and mild, moderate, or severe COVID-19 compared treatment with VEKLURY for 10 days (n=541) with placebo

 

..........

Overall, 29-day mortality was 11% for the VEKLURY group vs 15% for the placebo group (hazard ratio 0.73 [95% CI 0.52 to 1.03]).

 

Study GS-US-540-5773in Subjects with Severe COVID-19

A randomized, open-label multi-center clinical trial (Study 5773, NCT04292899) in adult subjects with confirmed SARS-CoV-2 infection, an SpO2of ≤94% on room air, and radiological evidence of pneumonia compared 200 subjects who received VEKLURY for 5 days with 197 subjects who received VEKLURY for 10 days.

 

 

Study GS-US-540-5774 in Subjects with Moderate COVID-19

A randomized, open-label multi-center clinical trial (Study 5774, NCT04292730) of hospitalized adult subjects with confirmed SARS-CoV-2 infection, SpO2 >94% and radiological evidence of pneumonia compared treatment with VEKLURY for 5 days (n=191) and treatment with VEKLURY for 10 days (n=193) with standard of care (n=200).

.....................

Overall, the odds of improvement in the ordinal scale were higher in the 5-day VEKLURY group at Day 11 when compared to those receiving only standard of care (odds ratio 1.65 [95% CI 1.09 to 2.48], p=0.017). The odds of improvement in clinical status with the 10-day treatment group when compared to those receiving only standard of care were not statistically significant (odds ratio 1.31 [95% CI 0.88 to 1.95]). All-cause mortality at Day 28 was ≤2% in all treatment groups.

 

....................................

Question:  Where is the statistically significant improvement in mortality?  Afterall this is an expensive drug that requires five days of hospitalization.

 

https://www.reuters.com/article/us-health-coronavirus-remdesivir-who/who-nations-mulling-gileads-covid-drug-should-consider-trial-flop-too-idUSKBN27829Z

WHO: Nations mulling Gilead's COVID drug should consider trial flop, too

 

Again...not meant to be medical advise which is between the patient and doctor only.  This is just for discussion.

 

[Cigarbutt]

...

With Sweden's cases spiking, I think my initial herd immunity hypothesis is broken.

Recently, The Swedish state epidemiologist (Mr. Tegnell) revealed the following insight: “I think the obvious conclusion is that the level of immunity in those cities is not at all as high as we have, as maybe some people, have believed, I think what we are seeing is very much a consequence of the very heterogeneous spread that this disease has, which means that even if you feel like there have been a lot of cases in some big cities, there are still huge pockets of people who have not been affected yet.”

Perhaps a way to reconcile the herd immunity aspect with reality implies to consider it as a dynamic concept and not as a binary outcome (helpful also to incorporate what Investor20 and yourself describe with the T- cell immunity aspect). Another consideration is that Sweden is showing a larger disconnect than others between cases and deaths and the benefit is related to developing herd immunity but, so far, the price that has been paid for dancing with the virus has not been recovered and probably never will be.

...

The virus has gotten less deadly as we’ve matured our treatment modalities: proning, remdesivir, antibody cocktails, steroids, avoiding things that don’t work (HCQ,etc) but a third wave would drive a population already conditioned to a deadlier covid to reduce consumption/activity. And having a virus that can kill your relatives and/or spending time in the ICU/hospital with a respiratory virus is not exactly enticing even if you survive.

...

i have a slightly different take on this.

 

 

The above is from the US but is simply used as an illustration of the disconnect that has been developing between rising cases and death rate trends, which is showing up in most places. When adjusting fore more tests, the rising cases have stayed tightly correlated with hospitalization rates but death rates have stayed low (relatively speaking!). There are many variables including minor ones. i submit that 'new' treatments such as Remdesevir and plasma therapy have brought only marginal improvements. The major reasons for improved death rates are: 1-the virus has been spreading to younger and less frail cohorts and 2-treatments that have been known for decades have simply been standardized. Through mostly trial and error, people on the ground have come up with (and shared) protocols and standardized approaches reflecting best practices. It's become clear that using the right approach in a timely manner can have a major effect on results even in the absence of 'new' or revolutionary treatments. This has been my experience as well from a practical point of view and the approach is often wildly underestimated in terms of potential improvements in outcome. The vaccines, over the next 12-18 months or more, are likely also to produce a relatively small and marginal effect on outcomes but the effect will be positive as low-grade excess mortality becomes part of the new-normal landscape. The part above about standardization and best practices is also being played out at the population level: 'we' are finding out (slowly it seems and clearly not homogeneous across the board) how to introduce simple (and targeted at times of resurgence) measures helping to deal with the virus and its spread. It's been a painful (to watch) process though.

-----

This is to disclose that i've been wrong. Previously, when describing the average years of life lost in relation to excess mortality, i've mentioned 10-12 and even 10-15; it looks like (new evidence keeps coming) that this is more like 9-10 (per death).

[clutch]

^ I tend to agree with Cigarbutt's sentiment regarding the disconnect between cases and death numbers.

 

IMO, over time, the general population will more likely experience scenarios in which they or someone they know have contracted the virus yet without any serious consequences, instead of them spending time in hospital/ICUs. This will convince people that the virus is not as deadly as they originally thought, and more people (especially the younger ones) will continue to relax their behaviors.

 

I think the case number will continue to fluctuate while the death numbers stay consistent at a relatively low level. I see this trend to continue until a wide-spread vaccine becomes available.

[Investor20]

^ I tend to agree with Cigarbutt's sentiment regarding the disconnect between cases and death numbers.

 

IMO, over time, the general population will more likely experience scenarios in which they or someone they know have contracted the virus yet without any serious consequences, instead of them spending time in hospital/ICUs. This will convince people that the virus is not as deadly as they originally thought, and more people (especially the younger ones) will continue to relax their behaviors.

 

I think the case number will continue to fluctuate while the death numbers stay consistent at a relatively low level. I see this trend to continue until a wide-spread vaccine becomes available.

 

Yes....I agree....that is what is meant by "Herd immunity" according to Barrington declaration....not lack of infections but the disease becoming slowly less severe.  We are already seeing this.  Below is the CDC updated hospitalizations this week.

 

Early introduction of vaccine, especially for vulnerable along with therapeutics would help.

 

[orthopa]

That about sums it up:

https://www.cnbc.com/2020/10/23/fauci-says-trump-hasnt-attended-white-house-coronavirus-task-force-meeting-in-several-months.html

 

Fauci says Trump hasn’t attended White House coronavirus task force meeting in ‘several months’

 

The head of state in almost every European country may have been with him too.

[Dalal.Holdings]

No worries:

 

"We are rounding the turn (on coronavirus). We are rounding the corner."

 

-Trump 2 days ago

 

Is it Easter yet?

[Investor20]

No worries:

 

"We are rounding the turn (on coronavirus). We are rounding the corner."

 

-Trump 2 days ago

 

Is it Easter yet?

 

If you look at hospitalizations, they are around mid March in US.  As mentioned in earlier posts, the infections will be there...even twenty years later, similar to flu.  That is my understanding from Barrington declaration.  However, progressively it will becomes less severe.

[Cigarbutt]

...

IMO, over time, the general population will more likely experience scenarios in which they or someone they know have contracted the virus yet without any serious consequences, instead of them spending time in hospital/ICUs. This will convince people that the virus is not as deadly as they originally thought, and more people (especially the younger ones) will continue to relax their behaviors.

I think the case number will continue to fluctuate while the death numbers stay consistent at a relatively low level. I see this trend to continue until a wide-spread vaccine becomes available.

Yes....I agree....that is what is meant by "Herd immunity" according to Barrington declaration....not lack of infections but the disease becoming slowly less severe.  We are already seeing this.  Below is the CDC updated hospitalizations this week.

Early introduction of vaccine, especially for vulnerable along with therapeutics would help.

1-On the 3rd wave that the CDC data does not show really well, at least at this point. Just like in early July, when the CDC did not show well for a while the forming 'second' wave because of lag-related issues (lag in reporting updated data and lag inherent to the sequential case-hospit-death that tends to occur over time). It looks like the "third' wave will be smaller. Compare:

and

https://covidtracking.com/data/charts/us-currently-hospitalized

 

2-"Early introduction of vaccine, especially for vulnerable along with therapeutics would help."

This benign and perhaps obvious on a first level basis statement is, in fact, a fascinating statement and may explain part of the misunderstanding implied by the Barrington Declaration. Even under the most optimistic scenarios, the vaccines are unlikely to be distributed widely for many months. Also, the earlier forms of the vaccines may be the most at risk for temporary immunity. So, vaccines are likely to be insufficient, in terms of demand, for a while and an interesting discussion will occur concerning who will or should get it first. Before Covid, when discussing scarce vaccine availability and herd immunity for a population, a predominant school of thought suggested to distribute the valuable vaccine not to the 'vulnerable' population but to frontline workers and other individuals who could act as super-spreaders and to use other 'social' measures to keep the vulnarables protected.

[Spekulatius]

...

IMO, over time, the general population will more likely experience scenarios in which they or someone they know have contracted the virus yet without any serious consequences, instead of them spending time in hospital/ICUs. This will convince people that the virus is not as deadly as they originally thought, and more people (especially the younger ones) will continue to relax their behaviors.

I think the case number will continue to fluctuate while the death numbers stay consistent at a relatively low level. I see this trend to continue until a wide-spread vaccine becomes available.

Yes....I agree....that is what is meant by "Herd immunity" according to Barrington declaration....not lack of infections but the disease becoming slowly less severe.  We are already seeing this.  Below is the CDC updated hospitalizations this week.

Early introduction of vaccine, especially for vulnerable along with therapeutics would help.

1-On the 3rd wave that the CDC data does not show really well, at least at this point. Just like in early July, when the CDC did not show well for a while the forming 'second' wave because of lag-related issues (lag in reporting updated data and lag inherent to the sequential case-hospit-death that tends to occur over time). It looks like the "third' wave will be smaller. Compare:

and

https://covidtracking.com/data/charts/us-currently-hospitalized

 

2-"Early introduction of vaccine, especially for vulnerable along with therapeutics would help."

This benign and perhaps obvious on a first level basis statement is, in fact, a fascinating statement and may explain part of the misunderstanding implied by the Barrington Declaration. Even under the most optimistic scenarios, the vaccines are unlikely to be distributed widely for many months. Also, the earlier forms of the vaccines may be the most at risk for temporary immunity. So, vaccines are likely to be insufficient, in terms of demand, for a while and an interesting discussion will occur concerning who will or should get it first. Before Covid, when discussing scarce vaccine availability and herd immunity for a population, a predominant school of thought suggested to distribute the valuable vaccine not to the 'vulnerable' population but to frontline workers and other individuals who could act as super-spreaders and to use other 'social' measures to keep the vulnarables protected.

 

^ I hope for priority distribution for frontline workers as it would concern my wife. I think distribution of the vaccine (the three W’s - who, when, where) should be an extremely high priority for the government and it should be planned upfront before the vaccine is available.

 

FWIW, there is very little specific testing for front line workers here and I suspect it is for liability reason and because they want to avoid widespread quarantines for frontline workers, in case someone tests positive. The testing for patients appears to be quite comprehensive.

[StubbleJumper]

 

^ I hope for priority distribution for frontline workers as it would concern my wife. I think distribution of the vaccine (the three W’s - who, when, where) should be an extremely high priority for the government and it should be planned upfront before the vaccine is available.

 

FWIW, there is very little specific testing for front line workers here and I suspect it is for liability reason and because they want to avoid widespread quarantines for frontline workers, in case someone tests positive. The testing for patients appears to be quite comprehensive.

 

 

In the United States, the first part of that planning process should be a diagnostic blood test in advance to see who is already carrying antibodies.  So, create a two-stage vaccination process where people can apply in November to be amongst the earliest vaccinated, but as part of the deal, they go for a blood test in advance to see whether they have antibodies and actually have any imminent need for the vaccine.  Then, once the initial surge of demand is satisfied, you have stage 2 where anyone can present themselves at a vaccination station and obtain the vaccine on demand, whether they need it or not.

 

Today, we are at 8.6m officially diagnosed cases in the US.  So, how many true cases are there, maybe 85 million? That would suggest that already there is 27 or 28 percent of the population that likely has at least temporary immunity and does not urgently need the jab.  If the first jab does not actually occur until January 1, and if there are a modest 50k/day of officially diagnosed new cases in the US, there would be a total of 12 million official cases on January 1, which would likely represent perhaps 120 million people who have already had covid, or about 35 percent of the population.  Given the extent of covid spread to date, it is entirely possible that only ~100 million vaccinations would be required to drive the R0 below 1.

 

Other countries, such as Canada, where the spread has been less pronounced will require a much more comprehensive vaccination program.

 

 

SJ

[Gregmal]

Sheeeeet man, people really think bad news will lead to stimulus? Wish I had known that in March, April, May, June....Bbbbbut Buffett is bearish, I know. What to do, what to do.

[Dalal.Holdings]

Wow, he predicted the unprecedented Fed intervention and PPP loans and stonks of course! Not all of us possess the gift of Nostradamus who has predicted everything up until this day (or is deluded enough to believe so)!

 

Some of us mere mortals are forced to think probabilistically and hold some cash for a rainy day. The barbell approach has worked out well enough for me so far this year, but wut do I know! Cash is clearly a useless asset...to some. Good luck being all in + margin—with those Nostradamus skillz, surely nothing can go wrong!

 

Never in doubt! Lol...

[Gregmal]

Too early to tell with precision, but I wonder what the impact of China’s high air pollution levels and high smoking levels (esp. men) have on complication probability for a pulmonary disease, and whether places without those negative cofactors can do significantly better.

 

 

Interesting, but the more interesting tweet I found was a couple below posting a link to this.

 

https://www.stlouisfed.org/~/media/files/pdfs/community-development/research-reports/pandemic_flu_report.pdf

 

Guess what happened next in the 20's?

 

But again, I can see how it is human and market nature to always assume the worst and then work backwards. As a historian myself, my application of understanding in situations like this, has always been to bet against the worst case scenario. If nothing else, you have the entire populations of politicians and bankers and experts working on your side. Similarly, how many people, even in a scenario like 2008, bet on failure and ended up losing? Getting squeezed out of shorts. Having insolvent counter parties? Seeing the Fed take actions that wiped out their bets? People like Peter Schiff who "called it" and still lost 80% that year. People who bought at the highs in 2007 and held tight in fact, did better than most of the doomsdayers.

 

The other arm of analysis, is, how far should this drag things down. People have mentioned a liquidity crisis, but as long as the Fed is where it is, I dont see that. Further, company profitability is not being zapped to 0, so couple this with the insanely low rates, and that debt markets certainly arent "closing". Demand in fact, should increase for issues from qualified borrowers, especially if the bond guys deem an economic seize up to be temporary. Basically just a bridge loan. If you are a shitty E&P or mining company, sure, but I'd gander 95% of S&P companies would have zero problem issuing debt.

 

So if we can eliminate liquidity induced plummet, then we have what? Just a recession to worry about. Is it possible we see Great Depression type stuff. I suppose, but probably not. Quantify what a temporary recession should do to the broader market... maybe comparable to something in the 70's or early 90s... but, most of those were greatly enhanced by energy/oil related issues and inflation, neither of which are really on the horizon here.

 

https://en.wikipedia.org/wiki/List_of_stock_market_crashes_and_bear_markets

 

Which one prior haven't we recovered from? Most were really just temporary shocks, similar to this, and exacerbated by program trading.

 

Further, at least here, plenty of investors prior to February, were cautious or paring down their exposure because of "valuation" concerns... in November, December, January, etc. We can call the recent rise a "blow off top", but I think thats silly considering that a 10% rise over a half year stretch isn't really a blow off top, nor did it take us anywhere that extreme compared to market levels back in 2018 or 2019. From late 2017 S&P ~2650. So from that point to today that "market" has blown off a whopping 5% annually? An 8% return would take us back to roughly were we were in January. Just because people have been crying about valuation for a long time doesnt mean it was true. Generally speaking, the "broader markets" are relatively efficient. I myself have had plenty of stocks where Ive pounded the table and said the valuation didn't make sense, but was ultimately just WRONG. Same can be said here.

 

The biggest issue I see right now is that the smart guys cant really calculate/model the impacts here so they're just throwing everything away. Still yet, I haven't really seen any of the fear driven people say where exactly the market should crash to or what levels it should now trade at. In fact, dare I say the value guys now just sound like momentum investors because "the trend is down". Again indicative of the above, and that fear is blinding.

 

Wow, he predicted the unprecedented Fed intervention and PPP loans and stonks of course! Not all of us possess the gift of Nostradamus who has predicted everything up until this day (or is deluded enough to believe so)!

 

Some of us mere mortals are forced to think probabilistically and hold some cash for a rainy day. The barbell approach has worked out well enough for me so far this year, but wut do I know! Cash is clearly a useless asset...to some. Good luck being all in + margin—with those Nostradamus skillz, surely nothing can go wrong!

 

Never in doubt! Lol...

 

LOL Dr. Dalal

 

Rainy days!

 

Also, just a pointer. You can utilize margin for risk management purposes too. You're never "selling to early" because its money you're making that other people arent and you can hedge out your risk and if you're wrong its already offset anyway. Dont teach that at University of Phoenix med skool do they? Hopefully things pick up for you so that you can earn your way out of needing a rainy day fund!

[Dalal.Holdings]

 

LOL Dr. Dalal

 

Rainy days!

 

Also, just a pointer. You can utilize margin for risk management purposes too. You're never "selling to early" because its money you're making that other people arent and you can hedge out your risk and if you're wrong its already offset anyway. Dont teach that at University of Pheonix med skool do they? Hopefully things pick up for you so that you can earn your way out of needing a rainy day fund!

 

Wow, you sound like you know exactly wut you are doing--as always! Can you also calculate Black Scholes in your head? Maybe you can start LTCM 2. There is zero probability this could go wrong. You're on top of it Jersey Boy--Send Warren the memo and let him know he should margin up Berkshire!

[Spekulatius]

 

^ I hope for priority distribution for frontline workers as it would concern my wife. I think distribution of the vaccine (the three W’s - who, when, where) should be an extremely high priority for the government and it should be planned upfront before the vaccine is available.

 

FWIW, there is very little specific testing for front line workers here and I suspect it is for liability reason and because they want to avoid widespread quarantines for frontline workers, in case someone tests positive. The testing for patients appears to be quite comprehensive.

 

 

In the United States, the first part of that planning process should be a diagnostic blood test in advance to see who is already carrying antibodies.  So, create a two-stage vaccination process where people can apply in November to be amongst the earliest vaccinated, but as part of the deal, they go for a blood test in advance to see whether they have antibodies and actually have any imminent need for the vaccine.  Then, once the initial surge of demand is satisfied, you have stage 2 where anyone can present themselves at a vaccination station and obtain the vaccine on demand, whether they need it or not.

 

Today, we are at 8.6m officially diagnosed cases in the US.  So, how many true cases are there, maybe 85 million? That would suggest that already there is 27 or 28 percent of the population that likely has at least temporary immunity and does not urgently need the jab.  If the first jab does not actually occur until January 1, and if there are a modest 50k/day of officially diagnosed new cases in the US, there would be a total of 12 million official cases on January 1, which would likely represent perhaps 120 million people who have already had covid, or about 35 percent of the population.  Given the extent of covid spread to date, it is entirely possible that only ~100 million vaccinations would be required to drive the R0 below 1.

 

Other countries, such as Canada, where the spread has been less pronounced will require a much more comprehensive vaccination program.

 

 

SJ

 

I don’t know if your 10x multiplier (tested positive vs actual infected). I have seen multipliers of 4-5x based on studied in Germany  that may not apply here. As testing gets better , this multiplier comes down.

 

As for antibody tests, they are somewhat costly and certainly will cost more than a vaccine. Frontline workers don’t get tested for antibodies either, so who exactly will bear this cost? I don’t think the capacities for widespread antibody testing is there either.

 

I don’t think antibody test results will play a role on how the vaccine is distributed.

[Gregmal]

 

LOL Dr. Dalal

 

Rainy days!

 

Also, just a pointer. You can utilize margin for risk management purposes too. You're never "selling to early" because its money you're making that other people arent and you can hedge out your risk and if you're wrong its already offset anyway. Dont teach that at University of Pheonix med skool do they? Hopefully things pick up for you so that you can earn your way out of needing a rainy day fund!

 

Wow, you sound like you know exactly wut you are doing--as always! Can you also calculate Black Scholes in your head? Maybe you can start LTCM 2. There is zero probability this could go wrong. You're on top of it Jersey Boy--Send Warren the memo and let him know he should margin up Berkshire!

 

Well, everyone should do what works for them. Different ways to go about it. Buffett has his approach, I have mine. If you're good at shooting the basketball you want to take as many shots as possible and when you miss, who cares, just look for the next opportunity to shoot. If you miss enough you get pulled from the game. I'm financially independent in my mid 30s and you're padding the rainy day fund and hoping for a Biden bailout. Good luck. Being scared of everything always going wrong to the worst degree possible is a great investment strategy and surely you should be able to pay off the student loans and retire by 65 or so!

[StubbleJumper]

 

^ I hope for priority distribution for frontline workers as it would concern my wife. I think distribution of the vaccine (the three W’s - who, when, where) should be an extremely high priority for the government and it should be planned upfront before the vaccine is available.

 

FWIW, there is very little specific testing for front line workers here and I suspect it is for liability reason and because they want to avoid widespread quarantines for frontline workers, in case someone tests positive. The testing for patients appears to be quite comprehensive.

 

 

In the United States, the first part of that planning process should be a diagnostic blood test in advance to see who is already carrying antibodies.  So, create a two-stage vaccination process where people can apply in November to be amongst the earliest vaccinated, but as part of the deal, they go for a blood test in advance to see whether they have antibodies and actually have any imminent need for the vaccine.  Then, once the initial surge of demand is satisfied, you have stage 2 where anyone can present themselves at a vaccination station and obtain the vaccine on demand, whether they need it or not.

 

Today, we are at 8.6m officially diagnosed cases in the US.  So, how many true cases are there, maybe 85 million? That would suggest that already there is 27 or 28 percent of the population that likely has at least temporary immunity and does not urgently need the jab.  If the first jab does not actually occur until January 1, and if there are a modest 50k/day of officially diagnosed new cases in the US, there would be a total of 12 million official cases on January 1, which would likely represent perhaps 120 million people who have already had covid, or about 35 percent of the population.  Given the extent of covid spread to date, it is entirely possible that only ~100 million vaccinations would be required to drive the R0 below 1.

 

Other countries, such as Canada, where the spread has been less pronounced will require a much more comprehensive vaccination program.

 

 

SJ

 

I don’t know if your 10x multiplier (tested positive vs actual infected). I have seen multipliers of 4-5x based on studied in Germany  that may not apply here. As testing gets better , this multiplier comes down.

 

As for antibody tests, they are somewhat costly and certainly will cost more than a vaccine. Frontline workers don’t get tested for antibodies either, so who exactly will bear this cost? I don’t think the capacities for widespread antibody testing is there either.

 

I don’t think antibody test results will play a role on how the vaccine is distributed.

 

I think the last large scale study in the US was the dialysis users' study, which showed that 9.3% of dialysis patients had antibodies during July.  In mid-July, there was 3.7m, official cases in the US, which was about 1.1% of the population.  So, the most recent major study would suggest 8 or 9 to 1 ratio for a sub-population of people who are more vulnerable than average and who should have been well motivated to avoid covid.  But, I would agree that presumably the 10-to-1 comes down as testing becomes more prevalent.

 

I suspect that you are correct that diagnostic antibody tests are unlikely to be used in a vaccination programme.  The first 20 or 30 million vaccinations in the US will be in hot demand from the most vulnerable populations, healthcare workers and first responders and then demand will slow as less vulnerable people will be less motivated.  Unfortunately, it is likely that 30% or 40% of those initial vaccinations that will be in very high demand will be "wasted" on people who are already immune by virtue of having already had covid without even realising it.  The cost of the "wasted" vaccinations in dollars will be pretty minimal, but the frustration of those who are anxiously awaiting their turn will be palpable (as it was during the H1N1 vaccination process).

 

 

SJ