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Weekend reading: Corona-crisis, round two

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What caught my eye this week.

The US may be about to see another surge in Covid-19 deaths. This is clearly tragic from a human perspective. We might also wonder what it will do to the market.

I’ve been pretty relaxed about the UK’s de-lockdown. Daily cases have steadily fallen, contrary to – soon forgotten – warnings at every stage that we were moving too fast.

Indeed it was probably only around 4 July that we went much past where I’d have set the limits for the actual lockdown! Albeit partly with the benefit of hindsight.

My hunch is 90% of the heavy lifting of preventing a rapid escalation of Covid-19, at least in summer, comes from basic social distancing and hygiene, and perhaps wearing masks inside.

Throw in today’s testing capacity – spectacularly absent back when many of us thought we had the virus – and it looks to me like enough to at least keep the situation contained.

More or less

Shutting down the economy, paying extra billions in furlough, not leaving the house more than once a day, keeping lovers apart for three months – I doubt it made much more difference. We should have focused instead on ring-of-steeling care homes. From day one it was the elderly who were clearly most at risk.

Still, reasonable people can disagree.

Early, when total cases are very low, maybe extermination from a heavy lockdown is an appropriate goal. Maybe if you’re going to get a 15% hit to GDP you might as well take a 20% hit and try to wallop the thing on the head. Fresh flare-ups in Australia and Hong Kong reinforce my doubts on that score, but even experts debate this – and I’m far from that!

But I still believe the case for uber-lockdown ignores myriad unforeseen costs and consequences.

Something I learned from Tim Harford this week is called the identifiable victim effect.

Nuclear cul-de-sac

For example, after the Fukushima nuclear disaster in Japan, hundreds of thousands of people were made to relocate from their homes for years on end.

Obviously, right? Nobody wants citizens getting sick from radiation.

Right, except it’s now thought relatively few lives were saved by the relocation. In fact it’s possible more evacuees killed themselves from the emotional wrench of separation and upheaval than would have died from radioactive fallout.

At least 50 suicides have been recorded. And there will have been tens of thousands of smaller tragedies, from job losses and broken relationships to farms falling into disrepair.

It’s all incredibly sad – but try making that argument when the Geiger counters are going haywire. I’m sure I’d have relocated them, too. Most politicians wouldn’t hesitate.

Some more emotive arguments about Covid-19, especially in the early days, saw this identifiable victim effect loom large.

America dreaming?

Still, I know that one thing all1 readers of this website will agree on is that Covid-19 is not a hoax…

…that being asked to wear a mask isn’t a plot to turn us into communists.

…and that saying a less full-on lockdown might have been more proportionate doesn’t mean I’m saying we should do nothing, or pretend the virus isn’t happening.

Yet, incredibly, swathes of Americans appear to have reached exactly those conclusions. A lunatic fringe apparently even believes ex-President Obama created the virus and is spreading it.

(So this is how democracy dies. Not with a bang but a “WTF? Really?”)

You can understand why the saner end of this happened. The US is a huge country. Much of the US was in lockdown when it probably didn’t need to be. Local lockdowns and exclusion zones might have been more pragmatic, and caused less frustration. Although this is with hindsight – I imagine the US health officials didn’t expect things would eventually go so far off the deep end.

Anyway, the end result is the virus seems to be taking off rampantly again.

I have tried to stay open-minded about this. In particular the US is now doing over 600,000 Covid-19 tests a day. It’s a truism (not a Trumpism) that if you increase testing in a pandemic you’ll find more carriers. So it was plausible that part of the surge in US cases was down to the huge ramp in testing.

(Imagine if we’d been able to test everyone in London over a few days in early April. We might have found half a million people with the virus!)

As you test more people though, what you don’t want to see is the percentage of positive results going up. That means you’re not just finding more Covid-19 carriers through more tests – it also implies there’s a growing number of them out there.

And what you really don’t want to see is daily deaths go up.

Unfortunately the US is now seeing dramatically more positive test results:

(Click to enlarge the misery)

This might not have been definitely terrible. I suspect young people have had enough of putting their lives on hold for something that will only badly affect a tiny minority. When respected US medical figures say as much as 50% of the US population will probably have had Covid-19 by the end of the year, you might well ask why not get it over with? Sure enough, the average age associated with a positive result has been getting younger in the US.

However, the counter-argument to the ‘let rip’ thesis is that eventually the pandemic ebbs up to and kills a swathe of the vulnerable.

And in my daily chart checks, that’s what I’ve noticed may now be happening:

(Click to enlarge: Notice uptick at far right-hand side)

Two questions for the market.

Firstly, is this uptick just an artifact of the natural history of the virus?

I’ve noted before it’s still not clear why thousands die in some places and other places get off fairly lightly. Maybe Covid-19 has taken a while to get embedded in some larger and more clement US environs? This is grim news for people living in such places. But it could mean a nationwide resurgence isn’t inevitable.

Secondly, is the US effectively going for a Swedish approach? Not openly stated, but de facto.

Again, this always seemed a plausible endgame to me with a virus this transmissible, and yet apparently ultimately harmless to most. The cost of repeated shutdowns is just too great.

It’s worth noting that for all the wailing and gnashing of teeth, the Swedish approach has sort of worked.

Yes, before *you* say it, plenty of people have died. As I always reply, we’ll only see in the end how premature much of this death really was.

But more importantly for this discussion, many were arguing in April and May that only stringent lockdown could curb the spread of the virus.

The Swedish experience, painful as it was, seems to show that’s not true:

(Click to enlarge the counterfactual)

Through one lens Sweden’s approach looks like a failure. It comes fifth ranked on deaths per capita from Covid-19. (Though that’s still better than lockdown-happy Britain at third).

But this isn’t the argument I’m making here. I’m simply saying a looser policy that accepts the virus will spread and run its course isn’t a catastrophic policy from the set of bad choices on offer.

The US may be about to find out, one way or another. Frustratingly, I could see the market taking this news either way.

Bluntly and economically-speaking, it probably fears another fully-loaded economic shutdown more than a higher death tempo among the elderly.

On the other hand, a return to New York-like scenes on the news is hard to square with a recovering economy let alone buoyant share prices – even if the very worst fears and tail risks of this pandemic have now been lopped off the distribution graph.

Hold on to your hats (/allocation to bonds and cash). Things could be about to get bumpy.

From Monevator

The UK’s worst stock market crash: 1972-1974 – Monevator

From the archive-ator: The investor sentiment cycle – Monevator


Note: Some links are Google search results – in PC/desktop view you can click to read the piece without being a paid subscriber. Try privacy/incognito mode to avoid cookies. Consider subscribing if you read them a lot!2

Sunak’s Summer Statement: Key points at-a-glance – BBC

No help for ‘excluded’ three million self-employed in Sunak’s mini-Budget – ThisIsMoney

Stamp duty cut up to £500,000: how much will you save? – Which?

The stamp duty cut is a boost for buy-to-let landlords [Search result]FT

House prices to fall 5% in 2020 and 10% in 2021 despite the cut, says CEBR – ThisIsMoney

VAT cut for restaurants, pub meals and hotels: what will it mean for you? – Guardian

High-rise flat owners are effectively being told they cannot sell or remortgage for years – Guardian

Comparing different rebalancing tempos with long-term buy-and-hold [Note the tight axes!]Morningstar

Products and services

How much will people get in the ‘Eat Out to Help Out’ scheme and where can you use it? – Metro

Hargreaves Lansdown revives ‘best buys’ after Woodford scandal – Which?

Sign-up to Freetrade via my link and we can both get a free share worth between £3 and £200 – Freetrade

Will your local John Lewis be closed down? Eight are going, putting 1,300 jobs at risk – ThisIsMoney

Homes off the beaten track [Gallery]Guardian

Comment and opinion

Is it crazy to own gold? – Value Stock Geek

Is it possible to save too much money? – Money Maven

Using an all-in-one fund in a downturn [Ignore the US-relevant comment about taxes]Oblivious Investor

Dead people don’t get to retire – A Teachable Moment

Busting the pension Lifetime Allowance is music to my ears [Search result]FT

Safe bonds are the best diversifier for stocks… – Morningstar

…but on the other hand  [US but same difference]Alpha Architect

The danger of learning from your mistakes – Validea

The bear market in happiness – A Wealth of Common Sense

Fancy fintech’s fishy fun: a rant – Simple Living in Somerset

Institutions banking on private assets mini-special

The nerdy, contentious, and existential debate raging inside one of Britain’s biggest funds – Institutional Investor

Alternative assets [and the pseudo-Yale model] are a “a loser’s game”Investment Magazine

Naughty corner: Active antics

Charlie Songhurst: Lessons from investing in 483 companies [Podcast]Invest Like The Best

Why Ted Baker has been a disaster and a gift in equal measure – UK Value Investor

Buffett’s $90 billion Apple stake is now 43% of Berkshire Hathaway’s entire stock portfolio – Business Insider

GMO, long bearish, loves US banks – Institutional Investor

First-half review: Running up that hill – IT Investor

More coronavirus chatter

Why hasn’t the UK seen a second wave? – New Scientist

Herd immunity questioned after Spanish antibody study – CNBC

“I’ve spent years taming the OCD monster. Coronavirus has ruined everything”Guardian

Data show panic and disorganization dominate the study of Covid-19 drugs – Stat

Space jam – The Reformed Broker

Can big countries realistically eliminate COVID-19 without a vaccine? Four experts discuss – The Conversation

Patricia Lockwood: Insane after coronavirus [Beautiful and poetic]The London Review of Books

Kindle book bargains

You’re Not Broke, You’re Pre-Rich by Emilie Bellet – £0.99 on Kindle

The Economics Book: Big Ideas Simply Explained by Niall Kishtainy- £1.99 on Kindle

Alchemy: The Surprising Power of Ideas That Don’t Make Sense by Rory Sutherland – £0.99 on Kindle

When Genius Failed: The Rise and Fall of Long Term Capital Management by Roger Lowenstein – £0.99 on Kindle

Off our beat

Instinct – Indeedably

An open letter on justice and debate – Harpers (and an on-point tweet from Malcolm Gladwell)

Three women fight for two spots in the US surf team at the Tokyo Olympics – Marie Claire [via Abnormal Returns]

“How I became a poker champion in one year”The Atlantic

Elon Musk and other spaceflight pioneers rally around a failure-struck rival – Business Insider

Our top story – Seth Godin

Regrets – Of Dollars and Data

And finally…

“The lesson is that no amount of sophisticated statistical analysis is a match for the historical experience that ‘stuff happens’.”
– Mervyn King, The End Of Alchemy

Like these links? Subscribe to get them every Friday!

  1. Okay, 99% []
  2. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. []
{ 72 comments… add one }
  • 1 ermine July 11, 2020, 12:27 am

    > Things could be about to get bumpy.

    Heck, after March’s rough ride that is really saying something!

  • 2 xeny July 11, 2020, 6:54 am

    That Morningstar rebalancing article works better for me as a search result than as either a copied/pasted link or a simple click.

  • 3 Beau July 11, 2020, 7:06 am

    Many thanks for maintaining this incredible resource. I look forward to sitting down with a coffee every Saturday morning to read your compiled links and commentary.

    Thanks also for provoking reflection on our national response to coronavirus. Yours is a perspective I haven’t really come across, and it’s given me much to think about.

    A question: my understanding of the lockdown strategy was that its principle aim was to keep the healthcare system from being overwhelmed. There were times in April where it looked like some London hospitals were being pushed to the brink, although there was unused surge capacity at the QEII Centre. I’m wondering how a Swedish approach would have prevented us tipping over the edge. Is the idea that an early intervention in care homes would have reduced hospitalisations sufficiently to avoid crippling the service? Or that the service being overburdened to some degree would be a better outcome than the impacts of a months-long lockdown?

  • 4 Hari July 11, 2020, 7:23 am

    Thanks again for a great selection of links, it’s a lot of work but appreciated here.

    The rebalancing article was good to see data, particularly interesting that daily rebalancing had (small) merit.
    I must admit to have manually rebalanced after particularly volatile days of late and made a grand or two each time, but on a portfolio level it’s not really noticeable, although it offsets the portfolio costs for a year or so. Given this degree of volatility is unusual it’s not that useful going forward!

    Re Covid strict lockdown vs enhanced personal care, I don’t doubt the Swedish style approach could work well if everyone was prudent…. given yesterday’s report of a French bus driver being murdered by 2 passengers who objected to being asked to wear a mask, a degree of compulsion is likely to be necessary.

  • 5 FI Warrior July 11, 2020, 7:53 am

    There is another alternative to the virus possibly resurging in a ‘second wave’. Basically viruses are a parasite, wanting to hijack the resources of a host to propagate themselves, thus ensuring their continued existence. But when viruses make the jump into a novel host, they aren’t initially suited to them in that they haven’t co-evolved for a long time. This means that they can be lethal as the new host’s immune system has no experience in dealing with them. Importantly, the result is not good for the virus either when the host dies quickly, (or it can’t reproduce, thus defeating the object) so the ideal scenario the virus needs if for the host to do as well as possible without getting rid of the virus.

    Co-evolution, like an immunological arms race, usually ends up in a mild infection or the host tolerating a low viral load without even noticing and in this way, the host species even becomes a reservoir for that virus. (like humans with the annual ‘winter flu’ which is effectively the most infectious batch of viruses randomly arising at that time) As such after a species switchover, when the virus spreads between individuals, survival favours those who have mutated to be milder. The speed of their reproduction is so rapid that even a low rate of mutation combined with high infectivity of new hosts can quickly give the new sub-population a competitive advantage to the point where it can at some point replace the others. This happened with HIV and even slowly with ebola right now, because it’s the default natural pattern with viruses.

    So protecting the identified vulnerable populations (carehomes are already partially segregated from the general population) and letting the virus rip through the healthy remaining majority is more likely to phase out the virulent strains as fast as possible.

  • 6 The Investor July 11, 2020, 8:45 am

    @Beau — Thanks for letting us know you enjoy this resource. It is great to imagine people looking forward to it!

    A question: my understanding of the lockdown strategy was that its principle aim was to keep the healthcare system from being overwhelmed. There were times in April where it looked like some London hospitals were being pushed to the brink, although there was unused surge capacity at the QEII Centre.

    I think this rather understates the spare capacity. A handful of London hospitals at the worst were strained to breaking point for a few days. The Nightingale hospital at Excel, which had an initial capacity of 500 and could have been expanded to 4,000 beds was essentially unused. (Though there is some comment that this is because doctors didn’t trust the facilities).

    But anyway, that’s all hindsight speaking.

    What I (amateurishly!) argued at the time was we should have been doing my (lighter) lockdown and distancing earlier, and concentrated more on protecting the elderly.

    It seems I have to keep stressing that I am not saying we should have done nothing! 🙂 We should have done at least a Sweden-level lockdown — and I’d have closed bars and restaurants, too. But I’d have left other shops/offices open, with distancing and a presumption that you’d mostly stay at home if you could. Nobody would be shaking hands, hugging, mixing in groups. People would be wearing masks indoors and encouraged to meet up outdoors. It’d still seem like a massive intervention!

    It is possible to argue the virus was already past the peak shortly after the time full lockdown came in, which might imply our earlier, belated and looser measures were already having an impact. I believe Sweden’s experience versus ours does show as you’d expect that a heavier lockdown curbs the virus faster. The question is whether Sweden (/us to an extent) gained any ‘firebreaks’ from a (potential) wider-spreading immunity (still TBC!)

    As I noted in a post the week before full lockdown came in, the elderly where I live were still very visibly mixing, kissing each other hello, crowding into shops, etc. The official narrative was “the virus doesn’t discriminate”. But the reality is it does.

    Some people will push back and with this or that edge case (e.g. Boris Johnson). And of course it’s possible even mild infections do more damage then we currently know. But I say again, at least in the US there are predictions that 50% of the population will eventually have the virus — and our own Chris Whitty was saying much to the same affect here earlier this year, from memory. So even if it is terrible, if a huge swathe of the population is ultimately expected to get it then that should be factored into the return on the sledgehammer of full lockdown.

    There are very articulate voices on this site who will argue that a partial lockdown is basically as bad as a full lockdown. I can’t really square it (has anyone looked at the bill for furlough etc?) but it’s a credible retort for sure. Maybe if we’d had a milder outcome, like Germany say let alone Australia, it’d be easier to feel that full lockdown was justified.

    Re: Focusing on the elderly, I think there would have been fewer critical cases and far less deaths, as well as a lot less emotional and economic collateral damage. This seems like common sense, but note there is a powerful counter-narrative that points out ICU patients were not particularly old when the virus was raging (I think men in their 50s and 60s were typical, from memory). Albeit this is possibly because beds were being rationed, and the old effectively had to be left to die. (Though remember going on a ventilator is horrific, so it might have also been a humanitarian choice in the case of the very old…)

    We were already in a bad place by late March, that’s the truth of it. The virus had (we now know) come in all over the country — more like a meteor shower than an asteroid — so any strategy was likely to look sub-par in retrospect.

    Also, as regulars will know I supported (reluctantly) a period of full lockdown at the start, at the least for the precautionary principle and to get a handle on the thing.

    In my post above I’m more asking what will happen in the US, given what we now know. Will the market assume the worst again, or will it remain sanguine if the economy stays basically open, in the face of cries of “the heartless market doesn’t understand Main Street” etc, because it understands those who die will mostly be in the 80s and not the healthiest, and that harsh though it sounds from a human perspective that targeting is pretty fortunate if seen through the cold lens of economic impact.

    (Again, someone will say “no, it’s still terrible economically” to which again I say “invert”. Would we prefer a virus that killed 30-something child-raising breadwinners? Of course not. I’m not saying the virus is good or even neutral. It’s bad. I’m saying overwhelmingly killing those near the end of their life is better than the alternatives.)

    Cheers for all the comments so far and to come. I won’t be replying to everything again — have said my bit! — but will be moderating as usual, and look forward to all constructive thoughts. 🙂

  • 7 Ruby July 11, 2020, 9:49 am

    @ The Investor – refreshingly sane and balanced analysis. I’d have been lighter still and trusted to common sense. As the Swedish epidemiologist had it ‘people are not stupid’ and we all have a well developed instinct for self preservation. My biggest gripe is how a limited lock down to ‘increase capacity in the NHS’ has morphed into a virus elimination strategy,which is surely a forlorn hope, and which strategy comes with highly undesirable restrictions on personal freedom, not to mention the economic fallout.

    One of the resident medics will be along no doubt but I think this comment is a little misleading…” but note there is a powerful counter-narrative that points out ICU patients were not particularly old when the virus was raging (I think men in their 50s and 60s were typical, from memory).” ….As one only puts a patient on a ventilator if one thinks they’ll come off it and make a proper recovery, particularly when they are in short supply, it seems logical that would see more 50 and 60 somethings ventilated than 70 or 80 somethings. That didn’t however stop HMG, lefty medics and msm weaponising our general ignorance about these things to claim the virus is especially lethal to middle aged (predominantly) men. 300 deaths in the under 60’s in those who were otherwise healthy suggests fairly clearly that it isn’t.

  • 8 xxd09 July 11, 2020, 9:53 am

    From Dr John Lee in the Spectator
    From Office on National Statistics-deaths in Winter/Spring population adjusted for the last 27 years
    This year is only eighth in terms of deaths
    Some perspective needed!

  • 9 Gentleman's Family Finances July 11, 2020, 10:03 am

    From the extreme and Partisan rantings i see on twitter and read about, I wonder if there will ever be a clear consensus on this whole episode. Not just the uk or us but Russia, Brazil and elsewhere. Mistakes were made but will any lessons be learnt?

  • 10 Grumpy Old Paul July 11, 2020, 11:09 am

    If you are going to rebalance annually a 60/40 equity/bond portfolio, is there an optimum date for execution based on long-term seasonal trends in equity prices? (‘Go away in May and come back in September’ )

    Articles and discussions about rebalancing strategies seem to concentrate on portfolios built on bonds and equities. What about multi-asset portfolios such as the Harry Browne Permanent Portfolio? And what about rebalancing within a geographically-split equity portfolio?

    Great set of links this week.

    Since I’m trying to control my blood pressure by lifestyle changes, I won’t be commenting on Covid-19.

  • 11 Playing with Fire July 11, 2020, 1:11 pm

    My concern with a lighter-touch lockdown isn’t with people’s common sense when socialising, but with some awful businesses forcing zero-hours workers into unsafe working conditions. Without the disruption of a major lockdown I could envisage many more of the Leicester garment factory stories. Sweden seems to have less of a culture of exploiting employees for profit.

  • 12 Sara July 11, 2020, 2:58 pm

    I think we forget how little we knew back in March about Covid 19 as a virus. We now know so much more – who is at most risk particularly. Plus identified an effective and cheap drug for those who do get very ill which makes survival more likely. Welsh Government even have a risk assessment tool at https://gov.wales/covid-19-workforce-risk-assessment-tool I scored 2 so I am low risk and if I lost some weight I’d only score 1.
    But we only know all this now.
    We also don’t know the long term health consequences of the virus yet – what percentage will bounce back quickly with no long term health problems versus those left with long term consequences? Survival can sometimes be the easy part compared to rehabilitation.

  • 13 The Investor July 11, 2020, 4:18 pm

    @Sara — I agree we should beware hindsight bias. And as I say, I would probably on balance have done the full lockdown, with scientific advisors telling me to do, if I was in the government’s shoes, at least for a couple of weeks.

    However I am not sure there is very much we know now that we didn’t know at the start. If I go back to the comment threads on Monevator in March (and to a lesser extent my posts) we already knew it overwhelmingly targeted the old, that for kids it was basically trivial / non-existent, that most transmissions as seen in early Chinese contact tracing data had happened indoors. Perhaps that latter point has moved a little I guess.

    What we didn’t have is proof. When I wrote here that I thought at least a couple of million had already had Covid-19 in April, critics argued this was “wishful thinking” and said it wasn’t in the data. When it seemed likely there was a seasonal effect, “no evidence”. When just eyeballing the pictures on the news showed you overweight people were more vulnerable, “no proof”.

    When the virus was waning in Sweden, one regular reader who has not issued a ‘mea culpa’ and perhaps is unaware of their blistering attack on that suggestion wrote that “the virus is showing an uptick, Sweden has utterly failed” or something to that effect. (My memory is good but not that good).

    Well no, not really. We saw what we wanted to see, perhaps, looking at Sweden.

    I accept fully we need such scientific evidence to be fully confident, but as I’ve always argued we were making decisions with incomplete information either way. We just happened to use the incomplete information to justify full lockdown, partners kept apart for months, the government paying the wages of nearly 10 million workers (all to be recouped in tax) etc, rather than a different path.

    The big thing that I have got wrong / hasn’t come to pass is high post-wave-one antibody levels. I really was flummoxed when even New York was showing antibody prevalence of only 25%. At this point I stopped speculating here so much about C-19, and went back to watching.

    Still, if you’ve been following closely, you may know there are potentially confounding factors here too. It seems very likely some people get/defeat the virus without an antibody response. Also that antibodies may drop below detectable levels in milder infections.

    But this is again into the ‘no proof’, ‘speculation’ category currently.

    Now there was big news yesterday that an area of New York are seeing antibody rates of 68%:


    Another working class area might have 58% rates. These figures are obviously provisional, but they’re suggestive.

    Finally, while I don’t think there’s been a conspiracy or anything silly like that, it’s true the data has not been given to us very usefully.

    e.g. The daily roll call of the dead, with no attempt to give us demographic or confounding mortality factors.

    And only very late into wave one were we really getting data about care home and hospital infections.

    One of my friend’s emailed me a leaflet from her local council today recounting that her borough of London had only seen 10 new cases in the community in the past week (three per 100,000 people, from memory) but that a local hospital had seen 70 new cases in staff that week alone!

    Vast amounts of the transmission and (sadly) death happened in hospitals and care homes. I would imagine when it’s all counted up we’ll discover this swamped the numbers — I suspect in at least 50% (but I wouldn’t be surprised to hear it was a factor in approaching 75%) of serious / fatal cases. (Caveat: Total guess on my part).

    Meanwhile while that was going on the entire country was frozen in carbonite, at a huge economic, health, and social cost, which we will be grappling with for years.

    Again, I’m not particularly pointing fingers here — I think this was an impossibly difficult challenge for any government, though ours did not cover itself with glory — but rather saying (a) now we’re past wave one, let’s immunise ourselves at least from hysteria should we see wave two and (b) wondering what it means for the trajectory of the US (and following that, markets).

    Cheers to all for comments! 🙂

  • 14 Passive Investor July 11, 2020, 4:29 pm

    @TI @Ruby. The relatively young age of ventilated ICU patients reflects the inability of elderly frail patients to tolerate the stress that ICU treatments put on the body. ICU treatments generally just support the functions of the vital organs giving them a chance to recover with time. The difficulty for elderly frail patients is that they don’t have the underlying capacity to recover after say 3 weeks on a ventilator. One common pattern is that their respiratory muscles waste away and they eventually succumb to secondary infections after suffering a lot of distress and extreme discomfort.

    These are the full data on the UK ICU experience for any one who is interested (one reading is that by its selective nature and relatively small number of lives saved, ICU was in public health terms a bit of a sideshow)

    These are interesting links that look more closely at the definition and measurement of excess deaths.



    For what it’s worth I broadly agree with both of you. Once it was clear the NHS wouldn’t be overwhelmed, that the infection fatality rate was lower than assumed in the Imperial Modelling and that covid-19 is largely a disease of old age (the median age of people dying with covid-19 is higher than the average life expectancy at birth) we should have rapidly pivoted to the kind of less economically damaging social distancing / hygiene rules described by @TI while throwing money at protecting the vulnerable. The economic fall out from the policy response is after all unbelievably huge. I imagine that historians looking back will see the graph of excess deaths lookIng like a small blip and the graph of GDP looking like a huge cliff edge while they shudder at the mistakes that were made.

  • 15 The Investor July 11, 2020, 4:30 pm

    @Sara: p.s.

    We also don’t know the long term health consequences of the virus yet – what percentage will bounce back quickly with no long term health problems versus those left with long term consequences? Survival can sometimes be the easy part compared to rehabilitation.

    Forgot to add this is an excellent point! 🙂

    Besides the complications of overt medical intervention (ventilators etc) there is growing evidence of a cohort of what are coming to be known as ‘long haulers’ who seem to take a long time to shrug off all the effects of the virus. (Again, no proof yet. But medical community now starting to research it).

    What I would say though is when millions are getting the virus anyway (in the UK/US/Spain/France etc) and when some US medical figures still think 50% of its population will get it (and UK lead medics have said similar) then I presume it’s a fact that’s not really guiding policy.

    It’s unfortunate and good to raise it, but perhaps just “is”.

  • 16 Learner July 11, 2020, 6:56 pm

    Hello from the US. We’re doomed 🙂 This purple state handled it fairly well early on but began re-opening early relative to others. Stay-at-home ended early May, dine-in restaurants were allowed from early June. The data had been encouraging until a few weeks ago when hospitalizations stopped declining and are now increasing again. Deaths have also begun increasing again. Additionally, testing is still limited. Fed funding has recently been withdrawn and public testing sites which had been freely available are now capped per day or only available to people with symptoms. Honestly it does not look good here, let alone in Texas or Florida.

    The federal unemployment top-up ends this month and the Senate seem completely disinterested in extending it. They only approved a 6-week extension to the employer loan/grant scheme 4 hours before it would have expired. The court hold on evictions has also ended. Families with no work, no support, no health care, having given everything else are now going to lose their housing. And the government itself is currently pursuing a lawsuit seeking to invalidate the entire Affordable Care Act. America’s inadequate, tragic response to coronavirus and the recession is entirely political.

    I’m incredibly fortunate to have found a new job in the midst of all this, though still without health insurance until employer coverage kicks in. Starting a new job completely via Zoom and Slack has been an interesting. Some employers had been floating a September partial return to offices but I can’t see that happening given the trends – I don’t expect to see my new coworkers until next year.

    All of which has zero bearing on the markets, obviously!

  • 17 Naeclue July 11, 2020, 8:03 pm

    I looked into rebalancing strategies quite some time ago using data from a private database I had access to. I found no statistically significant advantage in rebalancing daily, monthly, quarterly, annually, or on exceeding out of ballance limits. That is not to say there were no differences between strategies, there were, as the Morningstar article illustrates, but these varied according to chosen start and end dates. Different answers were obtained by rebalancing on different days of the month as well.

    I looked at fixed geographical allocations for shares and rebalancing between them and found that a futile activity. Share markets are too highly correlated for there to be any expected benefit. I actually got worse results doing this than whole of market buy and hold, but the results were not statistically significant, so I would not discount it as an approach. It would avoid bubble situations, like the one in Japan.

    In most 10+ year periods it is usual for one asset class (equities/bonds) to significantly beat the other, usually shares beating bonds, so that buy and hold was usually the better strategy. But when returns were similar over a period, rebalancing was consistently better than buy and hold. I don’t recall the exact figures, but it would not be unreasonable to expect a rebalancing benefit of 0.5% in those circumstances compared with buy and hold. Even then the outcome was highly variable depending on the period and rebalancing strategy.

    So there you have it, your optimal rebalancing strategy can be chosen with the benefit of hindsight and occasionally articles come along which cherry pick results to prove or disprove the benefits of rebalancing.

    My own approach was to consider rebalancing annually, but put intermediate contributions into underweight assets. My equities portfolio is for the most part cap weighted, although I am overweight small caps, US REITS and hold some US shares in a minimum volatility ETF. If I had my time again I am not sure I would bother with the min vol or REITS, but would probably still overweight small cap ETFs. My allocations to min vol, small caps and REITS were very ad hoc and I have never considered rebalancing to particular weights.

  • 18 Brendan Jackson July 11, 2020, 10:21 pm

    On Sweden: no, of course it’s not been a complete disaster. And the virus is now, slowly, under control.

    But it’s not at all clear to me they’ve saved much of their economy compared to e.g. Norway, while still they’ve had many more deaths per capita. As you say, the longterm is only when things will become clear. But right now they’re behind in the obvious metric, and not obviously above in any.

  • 19 The Investor July 11, 2020, 11:03 pm

    @Brendan — I see Sweden as a sort of game theory issue. As you say, they’ve taken a pretty bad economic hit anyway, almost (though not quite) as bad as their near-neighbors, basically because (a) economic activity slowed anyway because of the virus and reactions to it, and (b) the rest of the world has nose-dived, and Sweden is part of the global economy so it’s imported that slowdown, too.

    However if we look at it through the lens of ‘what if everyone had been more like Sweden?’ then it might yield some interesting scenarios.

    Of course countries that (apparently) quashed the virus with very few cases (e.g. Australia, at least until this Melbourne flare-up) would say not on your nelly, but there are countries that did a far tougher lockdown and have anyway still seen comparably bad or worse outcomes (e.g. us).

    I imagine life has been more pleasant and there will be fewer accidental knock-on consequences in Sweden due to its lighter lockdown (re: my comments about the identifiable victim effect) but equally I’m sure people will still be writing Phds trying to unpick that in 20 years time.

    Certainly no obvious answers to any of this, at least once the thing was out there and Britain was importing 1,300 separate cases at the very start of the pandemic (which realistically we certainly couldn’t have contact traced at that time, and I wonder if we could now to be honest.)

  • 20 Brendan July 11, 2020, 11:59 pm

    Certainly there’s no obvious answers. It’s even difficult to compare lockdown measures with engagement, especially given timing – New York lockdown was clearly stronger than Sweden’s but took place much later.

    I dread to think about the Autumn if there’s any seasonal component to come.

    One advantage we have now is that we can afford to make mistakes in how strong the lockdown is. If we loosen too much, infections are low enough that we can course correct without thousands of deaths per day as a consequence. At the time the strictest lockdown measures were introduced in the UK, the earlier delays meant we didn’t have that luxury.

  • 21 Vanguardfan July 12, 2020, 8:38 am

    A large component of seasonal effects in respiratory viruses is behavioural, due to people spending much more time indoors. I do anticipate transmission will increase in the autumn as people will be much less inclined to confine their social life to the great outdoors (whatever the regulations are, but of course the fact that people are being encouraged to socialise in pubs and restaurants means that restrictions on socialising indoors at home will/have become untenable). A lot will also depend on the extent to which the government urges us back into shops and hospitality venues in the run up to

  • 22 MrOptimistic July 12, 2020, 11:42 am

    @Naeclue, thanks for posting that. Re seasonality, application of logic to the torrent of data is difficult. What is noise and what is signal. The ongoing issues in India, Brazil, Mexico etc don’t point to any advantage from warmer weather. The experiences from meat packing plants, and perhaps from the excessively air conditioned US sunbelt states ( hint, take a pullover) look like lower temperatures are bad news. The virus could just naturally attenuate through genetic shift to a weaker threat. But it just as easily do the opposite.
    Politics, not medical evidence, has dictated how the UK has behaved. Just look north of the border to see how political advantage is being exploited.
    I think lockdown was probably too strong too, but I have bought face masks as there is a likelihood these will become and remain compulsory for the foreseeable future. Again, more driven by social signalling than facts but what harm can it do.

  • 23 jim July 12, 2020, 11:44 am

    Got to say that’s the first time i’ve read a footnote and thought I’m in the 1%. Obviously not with Obamas involvement but I think this mask business is absolutely wrong. People need to start looking after themselves. If they want to wear a mask that’s fine, mandating mask wearing is a step too far in my book. We will next be asking HMG to wipe our …
    Thoroughly disappointed with our gov’s response. Mandating masks towards the end of the thing. Bringing in quarantine far too late then relaxing it 2/3 weeks later. How many ministers hours were wasted on implementing this quarantine policy?!
    To be fair to them though they can’t really win. I hate them for curtailing our freedoms, other people hate them for not doing enough!

  • 24 ZXSpectrum48k July 12, 2020, 12:10 pm

    @Brendan. The UK vs. Sweden argument frustrates me in that we still have this narrative that “Sweden didn’t do a lockdown and is doing just as well”. People frame the concept of lockdown in terms of only the explicit govt response. That completely ignores the implicit lockdown from population level behavioural changes. Factors like mass transit usage, satellite data on car park usage at offices/retail parks, internet vs. physical retail credit card activity etc. If you look at an index of those activity signals and look at the time it took to reach say 50% of normal levels, Sweden was well ahead of the UK. Sweden hit 50% of many activity signals at around 1250 infections/million; the UK hit the same levels at around 3000 infection/million, two weeks later. The UK didn’t overtake Sweden in the intensity of it’s lockdown until late March. That was caused partially by Swedish activity levels rising sharply in late Mar/early Apr. They didn’t fall back till mid April.

    Two weeks actually can make a massive difference in outcomes if R is 1-3 and the doubling rate is say 6 days. If you build a simple multi-variate model (say a Bayesian network type approach) you find that 70-80% of excess death rates per capita is predicted by two factors: quarantines/border closure and the activity index dropping to 50% of normal. It can capture the bulk of even extreme excess death variations such as UK vs. Australia. What’s interesting is that the predictive capacity of an activity index dropping to say 20% of normal isn’t really any better than 50%. It seems that you need to cut behavioural activity quickly/persistently but not necessarily drastically. Perhaps that makes intuitive sense.

  • 25 Grumpy Old Paul July 12, 2020, 12:17 pm

    @Naeclue – thanks for that very informative post.

  • 26 Vanguardfan July 12, 2020, 12:32 pm

    @zx I keep banging that drum as well but I’m not sure many are listening.
    I don’t have much to add to the corona discussion, my conclusion, for some time now, is that by far the most important factor in the virus transmission is the extent to which people mix with others at close quarters indoors. I don’t think there is too much of a puzzle going on.

    I feel much less qualified to opine on the balance of economic vs health considerations in policy responses, other than to tend towards the view that economic damage is substantially driven by the virus threat itself, and the human behavioural response to that, of which government response is just one part. Of course there will be lessons to be learned. How we might actually prevent pandemics should be up there for learning, but that seems to be receiving rather scant attention.

  • 27 The Investor July 12, 2020, 1:07 pm

    @ZXSpectrum48k @Vanguardfan — There’s always been much more in common with our views on Covid-19 than in opposition, despite the fact that we tend to reach a slightly different conclusion.

    If we’re now saying, per Sweden, that the frustration is that it had a de facto lockdown that was as deep as ours — because the population opted-into it — and people just don’t realize it then to be honest I see that as yet another reason to have a lighter *mandatory* lockdown (allied to more consistent / less Dad’s Army government messaging in the early days).

    I know multiple couples who don’t live together and who literally didn’t see each other for three months due to lockdown. I have relatives who only saw their kids when they drove past and tooted the horn through the glass, because they were told they couldn’t even sit with them in the garden. I have two friends who started have suicidal thoughts, until they basically said screw it and started secretly meeting up with a few other friends. These people were besides themselves.

    This is just one of innumerable (emotional) consequences of full lockdown as mandated in the UK. I think the fact that these connections didn’t happen probably made a rounding error on the death rate.

    Of course the flipside is it’s a more difficult message to communicate than “stay in, see nobody, save yourself and the everyone around you from this killer virus” (oh and by the way we’re going to give you vouchers to bribe you out to sit in a pub in a few weeks time when there are still tens of thousands of infectious cases in circulation).

    I also believe a lighter mandatory lockdown would have had a lighter economic impact, but we’ve been around that course many times. 🙂

  • 28 Kraggash July 12, 2020, 4:18 pm

    It may be obvious, but Sweden is not like UK. It has a smaller population, and a greater area (granted much of it a bit chilly), with a lower population per square km. As has New Zealand, Australia, even France, and several other counties with low infection/death rates. Is there a deaths per 100k population, with population density considered, anywhere?

    Also, the Nightingale hospitals had plenty of beds and even some equipment. They did not have staff, and there were nowhere near enough nurses available to staff them. They were, in my opinion, an attempt to prevent bodies blocking the corridors of normal hospitals…

  • 29 Indecisive July 12, 2020, 8:16 pm

    @MrOptimistic, #22

    I have bought face masks as there is a likelihood these will become and remain compulsory for the foreseeable future. Again, more driven by social signalling than facts but what harm can it do.

    @jim, #23

    I think this mask business is absolutely wrong. People need to start looking after themselves. If they want to wear a mask that’s fine, mandating mask wearing is a step too far in my book.

    Mask wearing is pretty pointless until a critical mass of wearers is reached. I hear people say that wearing a mask is about protecting the wearer, and so it should be up to people to decide whether to wear one. That’s a misunderstanding. In the current situation masks are proposed to reduce transmission from the wearer to others if the wearer is infectious; not to protect the wearer from others.

    Masks can be used to protect the wearer from others, but to do that the masks need to be well-fitting and meet stringent filtration standards. The masks available to the public aren’t of this grade (and given PPE shortages shouldn’t be) and fitting masks properly is a skill. I’m crap at it.

    Your dentist and your surgical team wear masks for your protection as well as their own. It’s the same principle with mask wearing now for the general population: to reduce the chance that you (if, perish the thought, are infectious) pass the infection onto others, and that others if they are infectious pass the infection onto you.

    I would like to see mask wearing mandated indoors and social distancing reduced to 1m (scrapped outdoors?).

    Useful papers:

    And the history of masks:

  • 30 Indecisive July 12, 2020, 8:21 pm

    And a recent report I found just after clicking the “submit” button:

  • 31 Jonathan July 12, 2020, 8:29 pm

    @TI, a couple of news items tonight that seem to fit your suspicions aired on this blog.

    First the farmworker outbreak in Herefordshire – clearly it was easily caught (but mostly asymptomatic) by about a third of them. One assumes they socialised, but it is not obvious they engaged in high risk activities.

    And second the early information in the Guardian about a study at King’s London https://www.theguardian.com/world/2020/jul/12/immunity-to-covid-19-could-be-lost-in-months-uk-study-suggests. Three quarters of those followed for three months after a confirmed infections were showing a drop in antibody levels, in some cases to below the detected limit.

    It does make one wonder if the proportion of the UK infected is greater than the 7% or so identified by population antibody tests – and whether some of those not showing an antibody response nevertheless have some sort of immunity which may reduce the severity of subsequent infection even if it isn’t enough to prevent it.

    Obviously there are implications for the vaccine researchers. But in the end, provided protection lasts 12 months it wouldn’t (in the UK) be the end of the world if annual boosters were needed along with the routine flu jabs given to vulnerable groups.

  • 32 sam July 12, 2020, 10:11 pm

    you muppet.
    america testing 600k getting more cases logic puts you on trump’s IQ mate, the cases are always there even if you don’t test them.
    relocate fukusima is because of radiation.
    what a waste of time you are. stupid blogger

  • 33 The Investor July 13, 2020, 2:55 am

    @sam — The cases are indeed always there. Perhaps read my article again for my comments about testing and why the increasing positive result matters, then come back if you’re still confused and I’ll try to explain

    Regarding Fukushima, yes, both myself and Tim Harford are aware of radiation. I indicated this with the phrases “nuclear disaster” and “radioactive fallout”. Again, have a think of why Tim Harford, with his knowledge of radiation, would still be choosing to highlight other kinds of deaths. Because that was kind of the point.

    Sorry I wasn’t clear enough for you.

  • 34 Vanguardfan July 13, 2020, 11:35 am

    @jonathan. People living and working in close proximity is by definition a high risk activity. Workers in caravans are similar to other closed community settings which have had large outbreaks – care homes, cruise ships, migrant dormitories, prisons, crowded urban residential areas. One imagines there are lots of people per caravan.

    More generally, on the recurring subject of have we/haven’t we acquired useful population immunity. It’s worth keeping in mind the full range of possible explanations. If more people have been ‘infected’ but have shown no or fleeting antibody response, this is only helpful if it modifies their response to re-exposure – such that they are at lower risk of serious illness and/or of transmitting the virus to others.
    If they can get it again, and transmit it, then their past infection is irrelevant.
    If we find that no one has significant immunity after maybe 6-12 months, we are going to have a real challenge.
    It’s even possible that reinfection could result in a more severe infection (though no evidence of this afaik).
    We will need to wait to see whether reinfection starts to occur in the next few months in New York, London, Madrid etc. Fingers crossed.

  • 35 ST July 13, 2020, 11:37 am

    Well the pubs are open and if my experience is anything to go by, we are in trouble.
    Blatantly ignoring the rules and signposts, four people from different households sat at the same table, not even registering your visit to the pub (the ones that tell you to do it by yourself via an app), ignoring the one way systems, not sanitising on the way in.
    Give it 10 days, then lets see the results.

  • 36 xxd09 July 13, 2020, 12:29 pm

    My daughter works in a prison
    It has continued functioning all throughout the Covid outbreak-what else could you do
    Inhabited by a good cross section of a certain part of the community at large
    Admittedly housed and fed and access to medical facilities
    Had their casualties with staff and prisoners
    All settled now and functioning as before the outbreak
    Lack of access for education etc still in place -outside people
    Worth a study for the “true” performance/effect(as opposed to guesswork) of the virus in a semi closed community who just had to get on with it -with out weekly clapping!

  • 37 ZXSpectrum48k July 13, 2020, 12:50 pm

    @Vanguard. I see positives and negatives. The negative is clear. No persistant immunity, harder to make an effective vaccine. To be fair though, I’d take a vaccine that just made it less severe. Perhaps considered it more a therapeutic. I’m not fussy at this point.

    The positive is that it might mean that the actual IFR is somewhat lower. When I built my hazard rate calculator (to calc my probability of death from catching COVID: male, 45-49, asthma etc), I stuck in 1% as the IFR as a “conservative” estimate. I’m a pessimist by trade. I expected it to fall substantially lower over time as we gained info. Right now with 40-60k deaths and 7.6% seroprevalence, we’re still staring at a horrific 0.8-1.2% IFR. Everyone disses Ferguson but his 0.9% guesstimate seems incredibly accurate given it was made in early March. In fact, the Cambridge COVID Nowcaster has the median IFR at 1.3%, CL 1.1-1.5%. I was clearly too long “hopium” and too short “factium”!

    Perhaps with the possiblity of fading antibody immunity and some T-cell immunity, the real IFR might only be 0.5%, even 0.25%. Or I am still too long “hopium”?

  • 38 Vanguardfan July 13, 2020, 1:03 pm

    @zx, the trouble is you don’t know if you’re facing a 0.5% (or whatever) risk of death as a one off, or recurring every year.

    (Plus of course a several orders of magnitude greater risk of living but with significant morbidity).

    I’m kind of surprised we haven’t yet got a better handle on reinfections, but I guess it is still early days.

  • 39 Vanguardfan July 13, 2020, 1:04 pm

    Hopium is very seductive, though.

  • 40 The Investor July 13, 2020, 1:15 pm

    I’m kind of surprised we haven’t yet got a better handle on reinfections, but I guess it is still early days.

    I’d argue we do have something of a handle. As far as I know absolutely nobody in the world is yet known to have been reinfected with the virus.

    Where there has been ambiguity (e.g. persistent positive test results even after apparently recovering) it’s later been shown that this was due to dead genetic material, not live virus strands. (e.g. The South Korea example.)

    So to me this complete absence of reinfection cases in the most-watched healthcare crisis for decades (/ever?) is a very compelling piece of evidence that some kind of temporary immunity is conferred by infection.

    But as I say above in my piece, it’s not proof, so scientists can’t state it yet as proven. Which is right and proper. But still, it is highly suggestive.

    It might seem banal to state it, but on this blog and elsewhere people have been writing for months that “we don’t know whether infection confers immunity to future infection”. Well, I think it’s very hard to argue that now, just from observation.

    As @Vanguardfan and @ZXSpectrum48k are discussing, of course it’s true it tells us little about *how long* that immunity lasts. (‘Little’ as it’s obviously greater than zero, given the lack of reinfections.) Presumably we need time to find out. The waning antibody levels seen relatively quickly in populations of previously confirmed antibody carriers isn’t hugely encouraging though. 🙁

  • 41 The Investor July 13, 2020, 2:01 pm

    I continue to think this guy is worth us virus nerds watching as a literature review, albeit with a spin / interpretation:


    Caveats: He appears to have no qualifications, he’s just an interested, articulate, and seemingly intelligent observer.

  • 42 Ruby July 13, 2020, 8:36 pm

    @ ZX Spectrum – in March, when all this began, I believe David Spiegelhalter, one of the few measured voices I have come across, calculated that the risk of dying from covid amounted to around a year’s worth of additional risk (to the risk one would ordinarily have of dying). To estimate this I fairly sure he used Ferguson’s IFR of 0.9%. A month or so ago I think Spiegelhalter downgraded his estimate to a month’s worth of additional risk presumably because IFR reality had caught up with Ferguson’s modelling. Incidentally, Spiegelhalter’s revision brought him exactly in line with the estimate of Michael Levitt, Nobel Laureate, who is now enjoying widespread abuse online for his contrary view on the likely course of this epidemic. I have a different view on Ferguson and think that events have shown that he is no more than an oversexed metropolitan lefty with talent for self promotion.

  • 43 Jonathan July 13, 2020, 9:55 pm

    @Ruby, no need for insults. Ferguson is clearly metropolitan (job in London), but only arguably oversexed (known to have had sex once in the last 4 months), and if he has ever promoted any extreme political viewpoint it has not been publicised.

    His estimate of 0.9% IFR dates from back in March when there was virtually no data to work on – the government was testing only around 10% of those with suggestive symptoms. That is why his advice was used, the only way to make up for the data deficit was to use models. Even now the best estimates seem to coalesce on 0.7% (e.g. https://www.medrxiv.org/content/10.1101/2020.05.03.20089854v4.full.pdf). Though to be fair, once the dust settles I am pretty sure the figure will be lower since almost all studies will suffer from untested asymptomatic cases. (Mind you, it is a moving target anyway since fatality rates should decrease with understanding of best care such as dexamethasone).

    Ferguson’s problem was being someone whose job normally kept him out of the spotlight and who wasn’t ready for the scandal-hungry media he encountered – and the fact that his surname wasn’t Cummings which would have given him the free get-out-of-jail card. (He was foolish though, but not more so than Cummings).

  • 44 Indecisive July 13, 2020, 10:05 pm

    @ruby, #42

    Incidentally, Spiegelhalter’s revision brought him exactly in line with the estimate of Michael Levitt, Nobel Laureate

    Not according to Spiegelhalter: https://twitter.com/d_spiegel/status/1282771971995045896

  • 45 Sparschwein July 14, 2020, 12:45 am

    Yes IFR estimates have been converging to somewhere 0.5% – 1.2% for a couple of months or so. The CDC has just revised their estimate to 0.65%. IFR estimates always include asymptomatic cases.
    Ferguson’s early estimates are indeed impressively accurate. His mistake was to be a mere competent expert (the kind the right-wing media barely tolerate), rather than an unelected bureaucrat who runs the country (the kind the right-wing media love very much… oh wait..). Ferguson also lacked creativity – surely all the dropping-the-trousers business was only for an eye test!

    The realisation seems to sink in that we really don’t know how long immunity will last. That was a “known unknown” from the start, and should make everyone stop and think again about a herd immunity “strategy” without vaccine. I too haven’t seen any credible reports of re-infection (yet?); the question is what happens after 6-12 months.

    As for the longer-term consequences of Covid, the first study is out, and it’s not good:

    We need a suppression strategy with a combination of
    – massive-scale testing, contact tracing & isolation
    – masks everywhere indoors
    – ban risky “superspreader” events (crowds esp. indoors, esp. shouting/singing & long-term exposure)

    Other countries have shown it can be done.

  • 46 MrOptimistic July 14, 2020, 8:12 am

    ‘Albeit this is possibly because beds were being rationed, and the old effectively had to be left to die. (Though remember going on a ventilator is horrific, so it might have also been a humanitarian choice in the case of the very old…)’

    My father in law, a retired GP and past ENT surgeon was a hospital doctor in the 1950’s during the polio epidemic. He recalled that they had to assess each patient in terms of putting them in an iron lung. If it was probable that this would provide necessary temporary relief then it was used. If there was a real danger that once in the iron lung they would be there for ever then best not.
    I have a friend in Pasadena who recalled that on his daily commute he used to pass a house which had a victim in an iron lung positioned in a corner window, presumably so the patient could at least observe the world. Eventually the iron lung disappeared. Imagine being that patient, perhaps for 40 years……
    IFR might not be the most relevant measure of consequences!
    And please add my vote of thanks for your continued hard work.

  • 47 Seeking Fire July 14, 2020, 9:43 am

    I see face masks are going be compulsory from next week. Whilst I agree that the medical evidence indicates that this is worthwhile (although (a) wonder if it gives you a false sense of security (b) you are touching your face more?) although I am unsure with the decision overall with respect to restriction on personal freedom, I can’t help but feel this will hamper further physical retail shops i.e. more people moving to shop online. I’m not saying I’m against it – just making an observation I suppose.

    One person made a comment above that people flout the social distancing rules etc after a few beers. I can’t say that’s remotely surprising – did anyone think otherwise? A quick squiz at the latest deaths by age group again shows again from a ‘death’ perspective this is an elderly disease (figure 3)


    I acknowledge that some people are having recurring long term symptoms and there are plenty of anecdotes of people in hospital at ages younger than the elderly but I can’t say I’d be very concerned if I was in my twenties, thirties and I’m not concerned in my fourties either tbh. On the other hand, my partner’s parents continue to largely self isolate or strongly social distance and I suspect they will do through to next spring. I think that’s sensble – the IFR if you are >70 seems very high. I know most people know but it’s important to reinforce the IFR of say 1% is a mean with v wide variation around the ages.

    Interesting on the prevalence of antibodies in this and other studies. Seems a major gov cock up? wasn’t it back in March – Patrick Vallance talking about herd immunity as the way to go (I appreciate no one has yet known to be re-infected yet) + Hancock talking about immunity passports (that always felt a bit premature). Why isn’t the UK testing everyone (or as many people as possible) who has +ve tests for antibodies? Seems an important step?

    Since March – I’ve always felt that this will likely be around as a major issue until September 2021 and by then people will either have just permanently adapted, re-adjusted their own personal risk profile or we’ll have a vaccine / cure. So I am guessing all eyes will be on the winter as we approach.

    On that note – I personally think that it is people’s moral duty to get a flu jab – perhaps some people in the medical profession will have another view – but our whole family will continue to have one and believe others should do to.

    Diversify globally – given some countries most or less effected, have plenty of money in your emergency fund, recognise that fiat currencies (particularly the £ which is less stable given Brexit / Current Account Deficit) will be under pressure – there’s a lot of current chat (I think politically motivated) about taxes going up. As we’ve commented taxes on wealth, while politically attractive won’t raise much and taxes on basic rate / vat will harm the economy a lot. And when the Gov can borrow at negative nominal rates for 5 years and at 0.66% for 30 years (as it currently stands) it seems borrowing is a better approach.

    thanks for all the good links from everyone, v interesting to read.

  • 48 Ruby July 14, 2020, 10:20 am

    @ Indecisive – thanks, I hadn’t realised Spiegelhalter himself had disagreed!

  • 49 ZXSpectrum48k July 14, 2020, 2:41 pm

    @Jonathan. That’s a useful study you link to. The paper’s result is 0.68% for the IFR but look at their caveats: “It is not unlikely that, after correcting for excess mortality not captured in official death reporting systems, the IFR of COVID-19 in most populations would be higher than 1%.”

    I think it’s premature to look for a “global” IFR. Certain countries are doing better than others. The UK has at least 40k, possibly 60k deaths. Population weighted seroprevalence was 7.6% after adjustment for the accuracy of the Euroimmun assay for the period 4th – 29th June. That gives a “naive” IFR of 0.8%-1.2%. Cambridge Uni actually has 1.3% (https://www.mrc-bsu.cam.ac.uk/now-casting).

    I think the eventual IFR will come lower. This seems to be the trend for most diseases. Healthcare professionals have learnt much about how to care for COVID patients. I’m hopeful that the UK can get it below 0.5% since some countries have seemingly achieved that on the first wave. Perhaps we get it even lower once T-cell immunity is considered, lack of sensitivity from serology is added in etc.

    The problem is I just don’t know at what point I’ve replaced facts with hope. I prefer to deal instead with the UK numbers as they are. Going forward, that may be a “worst case scenario” for the IFR but that’s exactly what I want. I don’t do optimism. Plus let’s not forget about all those who survive but are left with longer term issues.

  • 50 ZXSpectrum48k July 14, 2020, 2:45 pm

    @Ruby. I don’t agree that someone like myself (male, 45-49) has an excess death probability of just one month. ONS data for Mar-May has the COVID death rate for male 45-49 year olds at 156.6. Using that, an IFR of 0.8-1.2% and correcting for the demographic/gender structure that puts the IFR for male 45-49 year olds at 0.14%-0.20%.

    Actuarial tables put the probability of death for a 45-49 year old over a 12 month period at 0.26%. That number includes suicide and other forms of self-inflicted death. Take those out and you’re looking at 0.20%. Most of that is cancer and accidents. The rate due to diseases is sub 0.1%.

    So with current UK data, I can’t see how it’s less than 8 months, possibly 12 months equivalent. For a 30 year old woman, you might get down to 1 month. The UK IFR for sub 70 year olds as a cohort is perhaps 0.1%-0.2% but age variation is huge. Each 5 year age gap is worth a hazard rate factor of about 1.75.

    I do think the advice being given out by the NHS is pretty ropey. I’m mildly asthmatic (ICS, not OCS). According to the NHS, this make me clinically vulnerable and high risk. Yet Cox regressions put the ICS asthma hazard rate at 110-125%, which is rather less than being male (175%-200%+). I don’t get how a 45-49 year female with mild asthma can be high risk, yet a 55-59 man without asthma is not. The hazard rate for the man is 5x that of the woman. The NHS should be telling us that all men are high risk. I suppose women would reply “tell us something we didn’t know” …

  • 51 Ruby July 14, 2020, 3:29 pm

    @ ZX Spectrum – I don’t think I quite understood what Spiegelhalter was saying and it seems he’s had a spat with Michael Levitt so I doubt my reference was terribly useful. Quantifying or rationalising ones own risk is difficult I find – I’m in the 55-59 bracket, and on a child’s dose ICS, but fit and routinely cycling 150 to 200 miles a week so I don’t really feel at much risk. However, as a non helmet wearing red light jumping London cyclists I wouldn’t argue if you said I needed a risk assessment course. Those two words again ‘risk assessment’ which one sees everywhere now and have to be the two most depressing words in the English language.

  • 52 Grumpy Old Paul July 14, 2020, 5:20 pm

    @xxd09 – The median age of UK prisoners is around 35 which is much younger than the population as a whole.

    @ZXSpectrum48k – I agree that the IFR is likely to fall. Two additional and linked factors are improved protection of care home residents (PPE, testing, limitations on visitors, fewer discharges from hospital) and a fall in the average age of newly infected people. I haven’t seen the stats for the UK but the southern US states are showing a massive drop in the average age of new cases, in Arizona for example from 65 to 35.

  • 53 Brendan Jackson July 15, 2020, 12:30 pm

    @TheInvestor: there have been plenty of anecdotes, and now even occasional clinical reports of reinfections. Medicine if full of exceptions; I’d fully expect those with a compromised immune system to be reinfected for instance. But what matters for the epidemiology (and the actuaries…) is the typical behaviour, and it doesn’t seem that it’s typical for reinfection within six months or so.

    Beyond that, we don’t know – we can only speculate based on similar viruses and typical immune response, which usually results in a milder disease, and perhaps less infectious. Waning antibodies level shouldn’t trouble you too much, as this is normal (T cells then preserve a ‘memory’ of the infection to produce antibodies faster in the next infection).

    To those writing about Ferguson and the IFR (especially @ZXSpectrum48k): Ferguson got his values from early estimates by Verity et. al (though he was of course last author on that paper, so he was hardly uninvolved!). But the credit should probably go to the first authors on that paper; they did surprisingly well given the limited early information.

    The IFR is going to be a moving target; it will depend on demographics and evolve as our treatments do. There will also be substantial excess mortality from the collapse of healthcare systems if the pandemic exceeds our capacity to handle it. Assuming we avoid such scenarios, IFR is not much bigger than 1%; it’s not much less than 0.5%.

    It sort of doesn’t matter, though, other than to calculate worst case scenarios. Letting R get too high for too long will be a public health disaster of sufficient scale – no matter the exact number of deaths – that there will need to be a counter response. The government then has to minimise the damage that causes, ideally preemptively (by keeping R low) rather than reactively (by instituting a national lockdown when cases have already reached high levels).

    I’d be surprised if we aren’t having many local lockdowns throughout the winter. Hopefully we don’t have a national one again.

  • 54 The Investor July 15, 2020, 1:38 pm

    @Brendan — Interesting comment, especially about waning antibody levels and the relationship with T cells. Need to brush up my immunology!

    Do you have a source for clinical reports for reinfection? As far as I am aware the ones that made headlines were all false alarms. Would be interesting to read, even if as you say they are unfortunate edge cases (e.g. immunocompromised and already in hospital).

  • 55 Brendan Jackson July 15, 2020, 2:42 pm

    A clinical report (as in…from the clinic) but a clickbait headline:


    There’s of course plenty of explanations that might be false negative/positive tests, even beyond the fact these might be outliers. But there are clinical, even if they’re ultimately incorrect or edge cases.

  • 56 Simon T July 15, 2020, 6:54 pm

    Anybody else using the Zoe app to report each day, interesting update today https://covid.joinzoe.com/post/skin-rash-covid

  • 57 The Investor July 15, 2020, 11:18 pm

    @Brendan — Thanks for that link. Interesting piece, although as you say potentially an outlier. But if the patient featured is just an unfortunate outlier at the front a vanguard of reinfections, it would be especially worrying.

    I just realized an error in my thinking on this; I’ve assumed we’ll hear about proven reinfection first from China because they got the virus first. But of course there’s apparently very little Covid-19 in circulation now in China. So perhaps if reinfection does become commonplace, it’d make sense if we learn about it in say the US first.

    Play the worst case scenario outlined by the physician in that piece forward though, and what we’d need really is not a vaccine but infinitely better treatments (/a ‘cure’) as the worst case would see even vaccine protection rapidly waning, presumably. 🙁

  • 58 ZXSpectrum48k July 16, 2020, 10:14 am

    I hadn’t spotted this (thanks to Ruby who made me check Spiegelhalter’s Twitter feed) but the following paper on risk factors associated with COVID has now come out in Nature (https://www.nature.com/articles/s41586-020-2521-4). This paper uses the one clear advantage the NHS has, it’s scale. It’s one of the most comprehensive analyses of risk-factors out there that I’ve seen (I’ve been looking quite hard).

    When paper first came out as a preprint it scared me. It had some fairly high hazard rates for those who were obese and asthma. I’m not actually obese but overweight and when added to be male and asthmatic, the compound risk factor to the topside was pretty unpleasant.

    When I looked at the numbers, however, something seemed odd. The hazard rates for obesity, in particular made, no sense at all but even those for asthma and gender seemed too high. Either errors in the input data or the regressions/spline used to fit the data. It didn’t match some other papers using UK data. I even wrote to them.

    Well in the revised version in Nature those anomalies disappeared. The fully adjusted hazard rate for being male has dropped from 1.99 to 1.59, a massive difference. The hazard rate for something like OCS asthma (normally mild) has dropped to 1.11 to 0.99 i.e. basically no additional risk. For modest obesity (BMI 30-34.9) from 1.27 to 1.05 i.e. only a 5% increase in marginal risk. These numbers look consistent and the CLs have narrowed.

    Using the above paper, this preprint (https://www.medrxiv.org/content/10.1101/2020.05.21.20108969v1) converts the hazard rates into a “male COVID age” risk score i.e. a white man aged 45, BMI 36, with controlled diabetes has a Covid-age of (45+5+4) = 54 years or a healthy Asian woman, aged 40, with has a Covid-age of (40+5-8) = 37 years. This is useful since we have the most data on age/gender related death rates. Personally, I prefer looking at “orthonormal” hazard rates but others may see this as useful in a risk assessment.

    I do find it frustrating that the media continues to trump headlines like “overweight at more risk of dying” when actually the more recent/larger/accurate studies are showing there is little or no evidence that overweight people are dying at a higher rate. In fact another UK study using ICNARC data found that overweight (BMI 25-29.9) people were less likely to require ICU than those with normal BMI (18.5 – 24.9). Albeit I tend to think they might be some data issues aswell! Even modest levels of obesity seem to be showing only low orthonormal risk factors once other correlated factors are removed (such as diabetes). No journalists are reporting these corrected papers. It clearly doesn’t fit the narrative. We desperately need journos (and politicians/policymakers) who have at least a basic understand of probabilities. Rant over.

  • 59 Brendan Jackson July 16, 2020, 11:19 am

    I’m not really sure what to make of China’s data – reporting seems even worse than America. But they have taken much more draconian measures, so it would probably make sense there are now fewer cases.

    This is a good article on T cells to read (by an industry expert that is worth following anyway):


  • 60 The Investor July 16, 2020, 2:55 pm

    @Brendan — Really interesting article/link. (Could also back up what that statistician was saying when he was talking about unknown ‘dark matter’ that apparently gave the German population some greater resistance to Covid-19 in his assessment?) Will include in the links.

    @ZXSpectrum48k — Cheers for that extensive data-driven rant. Apologies that your comment sat in moderation for a while (happens automatically with multiple links) as I was engaged for a couple of hours elsewhere and didn’t get a chance to moderate.

    Glad to hear your odds of being with us and contributing for many years to come have risen! 😉

  • 61 Vanguardfan July 16, 2020, 3:25 pm

    Worth just clarifying @zx that the paper is talking about mortality risk in those infected with covid (I wasn’t clear from your post whether it was referring to risk of contracting covid or risk of serious illness rather than mortality).

  • 62 Vanguardfan July 16, 2020, 3:28 pm

    I also find it irritating and illogical that they express risk in relation to a ‘healthy white male’. Why not pick the group with the lowest risk, the ‘healthy white female’? It is usually the convention to pick the lowest risk group as the baseline….

  • 63 Boltt July 16, 2020, 4:38 pm

    @ Vanguard

    The modelling software I used in Insurance automatically set the base level to be the factor level with the most data, although you could change the base level manually.

    Most policyholders were male too, so they were the base level too – obviously this was back in the good old days when we could use gender as rating factor!


  • 64 The Investor July 17, 2020, 2:58 pm

    Readers may remember I warned months ago that it seemed that all deaths *with* Covid-19 were being counted as ‘Covid-19 deaths’, specifically suggesting someone who tested positive could be hit by a bus and go into the figures.

    Some readers pushed back, but it seems Hancock may be coming around to the view.

    Today he’s ordered an ‘urgent review’.

    According to Oxford researchers who sounded the alarm:

    “A patient who has tested positive, but successfully treated and discharged from hospital, will still be counted as a COVID death even if they had a heart attack or were run over by a bus three months later.”



  • 65 Vanguardfan July 17, 2020, 3:07 pm

    @ti. Two quick points.
    1. Excess deaths remains unbiased method and we have clocked over 60,000 of them (not all directly due to covid of course)
    2. I don’t know how PHE are recording deaths, but I know that cause of death on death certificates (data collated by ONS from death registrations, not PHE) is recorded differently.
    No method is straightforward or free from bias. The more you know about it the more you know it’s not simple. There are likely to be far more Covid deaths that were never tested (most of our deaths occurred in April) than incidental deaths incorrectly classified.

  • 66 Vanguardfan July 17, 2020, 3:22 pm


    Is this the source paper? If so, you’ll see that the total PHE estimate is less than the ONS death registration estimate. So rather than over estimating Covid deaths it seems they underestimate.

  • 67 The Investor July 17, 2020, 3:31 pm

    @Vanguardfan — Cheers for the follow up. Yes, I was more struck by someone using the same ‘bus’ hypothetical that I did than the consequences for more/less deaths per se, immediately fired that memory circuit.

    Agree with your read on first glance.

    Also agree excess deaths are the gold standard. Of course we’ll need to see how quickly they drop out of the figures (i.e. will we get a three month run of below average deaths?) If it happens quickly then that will be an interesting counterpoint.

  • 68 Al Cam July 17, 2020, 4:17 pm

    @ZX &TI
    Assuming I am reading Extended Data Table 2 correctly in the Nature paper, this suggests to me that high blood pressure or diagnosed hypertension actually reduces your risk. This also seems to somewhat fly in the face of the narrative to date?

  • 69 Ruby July 17, 2020, 4:21 pm

    @ The Investor – there’s an interview with Carl Heneghan on Unherd on this which is worth a listen. https://unherd.com/thepost/prof-carl-heneghan-can-we-trust-the-covid-19-death-numbers/
    I believe a longer interview on covid more generally is coming up shortly also. Dr John Lee has been writing about the problems surrounding death certification in The Spectator for a few months now so you’re in good company.

  • 70 ZXSpectrum48k July 17, 2020, 5:31 pm

    @AlCam. You are correct in that there are some non-intuitive results.

    The technique they use is a very standard approach called a multivariate Cox (proportional hazards) regression. It’s a method for investigating the effect of several variables upon the time a specified event takes to happen (in this case mortality). In a proportional hazards model, the unique effect of a unit increase in a covariate is multiplicative with respect to the hazard rate. The method does not assume any particular “survival model” but it is not truly nonparametric because it does assume that the effects of the predictor variables upon survival are constant over time and can be additive in one scale.

    It’s that assumption that can cause some non-intuitive results. If you look at say High Blood Pressure you find the age-sex adjusted hazard rate is 1.09, the fully-adjusted is 0.89. The fact that the fully-adjusted is lower than than the age-sex adjusted is because they are trying to isolate the impact of high blood pressure vs. all other factors that might have driven the fatality. Remember though that those other factors (often more dominant factors) are also covariates in the regression and could be correlated with it.

    One such factor is age. This is correlated with high blood pressure. Moroever, age is the dominant risk factor, much than High Blood Pressure, in the regression. Because so many of the deaths associated with COVID are those above 70y of age, this large age risk factor causes the blood pressure risk factor to actually end up below 1.0. It gets “pushed down” by the dominant age factor. Hence you see sub 1.0 numbers for the full sample but numbers above 1.0 once adjusted for age-sex.

    I always want to see both age-sex adjusted and fully adjusted because age, in particular, is such as dominant risk factor and such as large part of the sample of deaths is 70y+. Fully adjusted is still important since if you use age-sex adjusted only you can overestimate the total risk by “adding up” too many risk factors. Some will overlap.

    It also doesn’t change the the reality is that some factors like blood pressure just don’t seem significant drivers even once the age factor is taken out. Think about it. I’ve aged about six months since COVID was first talked about. In that time, my probability of death due to age risk factor has increased by about 5-10%. So blood pressure isn’t the thing you want to be worried about.

  • 71 ZXSpectrum48k July 17, 2020, 6:08 pm

    Addendum. Just to be clear when i said at the end “my probability of death due to age risk factor has increased by about 5-10%”, I don’t mean I’m now 5-10% more likely to die. I mean if my probability of death was say 0.5%, then 6 months later it might be 0.525%-0.55% i.e. 5-10% greater. So the impact of high blood pressure is perhaps equivalent to six to 12 month in age terms.

  • 72 Al Cam July 18, 2020, 8:43 am

    As you say, somewhat non-intuitive.
    But, to slightly recast a couple of well-worn clichés: we all live (hopefully) & learn; and every day is (should be?) a school day.
    Thanks very much for taking the time to explain.

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