America is still the country to watch… but it’s like watching a train wreck.
Good news. Disney World has reopened!
Great stuff. Must mean that the US is on top of things, right?
Well, actually, not so much.
The number of daily cases is on the rise.
I don’t know if you’ve been tracking this chart like I have (The prospects for the global recovery swing on what happens in America, IMHO), but this is grim.
I can remember watching it at the beginning of June, when the new wave was building, and we were all anxious about whether we’d get back to April’s peaks.
But nup. Blew that out of the water. New Cases are on a break away and don’t look like slowing down soon.
That’s starting to have its impact on the health system. Hospitalisations are starting to rise again. We’re still aways off April’s peaks, but definitely going in the wrong direction.
And ultimately, the only chart that matters is this one – the daily death rate. That’s three days in a row just shy of 1,000 deaths, and again, moving in a very worrying direction.
That daily death rate is key. Everything changes if that gets away from America again.
And I reckon you could write-off any prospect of a second term for Donald Trump.
I still think this is one of the biggest threats to the global outlook.
America is a mess of contradictions, and there doesn’t seem like there’s a clear way forward.
Many people in America want restrictions to ease – they want to go to Disney World. (Sorry, am I being unsympathetic? Well, I can’t go to the footy, so sue me.)
But they want restrictions to ease and for economic activity to get going again.
But we know that economic activity causes infection.
Investment bank JP Morgan have modelled a correlation between spending and new cases:
JPM has observed a correlation between spending levels and the subsequent spread of the virus three weeks ago, and it has remained strong over the last three weeks. Indeed, to date the bank finds that states with higher levels of spending—especially card-present restaurant spending—have seen more rapid growth of the virus in subsequent weeks.
To summarize, JPM has documented two important facts about the interaction between spending and the spread of the virus—higher spending levels have predicted the spread of the virus, but spending levels have not fallen much in the states where the virus has spread most rapidly recently. These two facts raise the concern that behavior in the hardest-hit states has not changed enough to stem the spread of the virus going forward.
That’s not partisan ideology. That’s fact. (Yes, I get my facts from billion-dollar investment banks whose only interest is money. You can trust them on some things.)
But this is the bind America faces. If they reopen, they reopen the way for Coronavirus to spread.
But people want to go to Disney World.
Good luck, America. You’re going to need it.