Critique of Virus Data
Last week, I learned something which further darkened my opinion of virus data. I spoke with my Swiss client, who reads Swiss news and sees the world from a slightly different angle than I do. He's a man of science, who, like me, places a high value on good data. He shared the following:
In all countries, the great majority of deaths have been individuals age 75 and over. Almost all of the victims had medical complications - heart disease, diabetes or something else - which contributed to his or her demise. As policy, Italy attributes all of these deaths to Coronavirus. Italian health authorities reason that no matter the existing condition, the virus pushed the patient over the edge and is therefore the cause of death. Hospitals are overflowing and Italy does not have time to investigate further. Meanwhile Germany, facing the same problem, takes the opposite approach. It only lists Coronavirus as the cause of death if it can prove that to be the case. It normally records causes of death other than Coronavirus, pneumonia, perhaps, for expediency and as a matter of policy.
As of this writing, Italy has had 105,792 cases of COVID-19 and 12,428 deaths, a mortality rate of more than 11%. Meanwhile, Germany reports 71,690 cases of Coronavirus, but only 775 deaths, a mortality rate of about 1%. These discrepancies, and others, cloud our view and cast doubt upon any conclusions which we might draw.
China has not reported a new case of Coronavirus in two weeks. How is that possible when 99.99% of its population, insofar as we know, has not been exposed to the virus? And Russia, population 144 million, has reported 2,337 cases.
I mention this because I remain skeptical of our data and deeply skeptical of our strategy. I see that the virus is highly contagious, and that the illness has overwhelmed the healthcare system in Italy, and soon in New York too. It's a problem. In the future, we clearly need a more elastic healthcare system to handle crises like this one. But I remain unconvinced of the danger of the virus to the world population. I will be interested to see how Sweden, where restaurants and stores remain open, fares in the next month.
On the bright side, the world stock markets recovered very nicely last week. From a stock market point-of-view, I don't think that this crisis is over. Plenty more bad news lies in wait. But the market has completed a test of how low it can go in the midst of scary headlines and a lack of reliable information - a panic. Maybe it will test those lows again. We'll see. But I hope that we have seen the worst, that the headlines will improve, and we can embark upon a long, probably slow recovery.