Coronavirus

[Castanza]

 

Of course it's a concept.  But, it is essential that we not simply drink the Kool-Aid that preventative measures will be adequate to ensure that demand does not outstrip capacity.  The graphic was conveniently drawn to give that impression (and maybe that graphic would be realistic for some countries with greater capacity). 

 

But, let's get real here.  In Canada we have 2.5 hospital beds for every 1,000 people.  That's 2.5 beds for available for all maladies, including cancer, heart attacks and car accidents.  If you are in the camp that expects 60%-70% of your population to catch this in the next 18 months, and if you believe that about 10% of those who catch it will spend 2 or 3 weeks in the hospital, we will almost certainly not have anywhere near adequate capacity.  Hence my suggestion that the capacity line for Canada should likely be drawn through the word "Measures" in the blue curve.

 

There's nothing wrong with prevention to change the shape of the curve, but it doesn't really change what is coming.  At a certain point you need to start thinking of ways to push the capacity line a bit higher...

 

 

SJ

 

No, the concept simply shows that if you can squish down the curve, you get benefits, which is hard to understand for the "well, the genie's out of the bottle, it's all pointless, nothing to be done" crowd. And it does change what is coming, nothing about this is binary.

 

Not shown on the graph is also the possibility of a vaccine, so you could draw a vertical line at some point, and the part of the cruve that gets squished past that line could also have it a lot better by vaccinating the most at-risk populations.

 

Where the chart goes wrong is by showing healthcare capacity. It's disingenuous.

 

If current healthcare capacity is sufficient to handle COVID-19 then that would imply Covid-19 is no worse than influenza. So either COVID-19 is not similar to influenze (which is what I'm hearing on here) or the other healthcare systems are full of shit about their "exceptional healthcare advantage".

 

The chart is a better representation of spending flexibility and that governments ability to levy tax funds. No governments "current" healthcare capacity is built for pandemic levels. Everything from beds, to machines, to supplies on hand is based on averages. It's still flawed though because there is not way to represent actual cases since the majority are probably unknown.

 

It's a difficult line to walk as the ability to levy funds requires timing, discretion, and responsibility. I prefer a leader that adheres to the aforementioned traits within reason. China was extremely flexible and they now have tons of small businesses going belly up. I wonder if those citizens are happy they avoided a "mild" flu (according to CDC) at the expense of their business and tax money? And I'm not saying there wont be significant economic impact in the US. And I'm not saying China should have handled it differently. I'm just saying there is more than one way to skin a cat. Someone mentioned the Fukushima meltdown earlier in the thread. Sometimes fear (cough cough media) can do more harm than whatever it is you're actually scared of.

[Castanza]

Another doctor here. (Never realized how many of us frequented this board until now!).

 

For non-medical folks the concept of Healthcare Capacity is squishy and abstract, but for those in the system it is very concrete.

 

The capacity to ventilate patients (breath for them using a breathing machine is one example of very specific healthcare capacity).

 

While the recorded mortality rate of Coronavirus is about 2% (give or take), we know that about 10% of identified infected patients develop severe pneumonia. Severe pneumonia effects your lungs capacity to exchange oxygen. If it gets severe enough, you would need a ventilator. The ability to ventilate patients using a machine is a very specific kind of healthcare capacity. In the Western world patients who are on a breathing machine are in the ICU and get round the clock monitoring. So they have a nurse at their bedside (that's 3 shifts of nurses per day), they have a respiratory therapist nearby to help trouble shoot issues with the machine (pressure settings, secretion suction, tube displacement, etc), and usually a team of doctors who round on them and oversee everything and make adjustments as needed.

 

I don't have hard statistics, but I would be shocked if the number of ventilators (even counting those in operating rooms and in storage) exceeded 200-300 per 1,000,000 residents in most healthcare systems.

 

That is the biggest bottleneck, imho. And that capacity is already being used at anywhere from 50-100% just dealing with the existing reasons people need ventilation (i.e. after major surgeries, from trauma, infection, etc). If you get a sudden wave of folks needing ventilatory support, they will most likely not be able to get it. We will be triaging folks who will get a ventilator and those who won't based on their overall chances of surviving the illness. This would be heart wrenching and very painful for healthcare workers, and patients' families.

 

We had the same discussions when SARS and H1N1 hit. I remember as a young trainee sitting in on an ICU meeting where they were hashing out how they would portion the 40 ventilators in their ICU if those infections began spreading widely. It was a very sobering discussion.

 

When I see some of our political leaders speaking about Coronavirus, I often find myself wondering if theyv'e counted the ventilators in their jurisdictions and worked backwards with the math to seem how many infections their systems could handle before reaching the venitlator breaking point. That is the kind of math most frontline workers are doing in their heads, and frankly that is why they are so focused on containing the outbreak. They understand the consequences if they don't.

 

M.

 

EDIT: Found this article after my original post. Looks like someone did a survey in canada and found we have capacity for 100-160 ventilated patients per million residents. (They expressed it as 10-16/100,000). https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4426537/

TLDR (WSB analysis) ;D

 

Buy Calls on top 5 largest ventilator manufacturers. Philips Healthcare (Netherlands), ResMed Inc. (U.S.), Medtronic plc (Ireland), Becton, Dickinson and Company (U.S.), and Getinge Group (Sweden). Some of the other players in this market are Dräger Group (Germany), Smiths Group plc (U.K.), Teleflex Incorporated (U.S.), Hamilton Medical AG (Switzerland), and GE Healthcare (U.S.)

 

 

[vinod1]

Amazing what Infovirus can do.

 

You have people who watch a few YouTube videos, follows a few Twitter threads and some news, This it seems enough to make them ready to offer specific steps on how a large country should go about containing the virus.

 

Look at what Buffett, Ray Dalio and Howard Marks said about the virus. They keep saying, "I dont know." "Maybe this, maybe that."

 

Here we have a level of conviction that I cannot even muster even for things I know something about.

 

I can understand someone with a background in epidemiology making some informed suggestions. I see some board members do have that background and it is helpful to get their views.

 

I keep thinking about what Buffett said about big events like Pearl Harbor, Cuban Missile Crisis, Arab Oil Crisis, Vietnam War, etc. etc. I can only imagine what this message board would be like in those situations. 

 

Vinod

 

 

 

[Gregmal]

 

Too funny. Everyone has an opinion.

[LC]

Here we have a level of conviction that I cannot even muster even for things I know something about.

 

Well, a few things:

 

Frankly, what do WB, RD, or HM know about viral infections? I would trust doctors on this message board before I would Warren Buffett if I showed symptoms.

 

Secondly, that's exactly what they should be saying. They are public figures and are not informed professionals - anything they say could be misleading at best.

 

And thirdly I wouldn't even say there's so much conviction on this board. I think people are extrapolating the few known data points in the spirit of 'better safe than sorry'.

[mloub]

The uncertainty is definitely part of what makes this tricky from a public policy perspective.

 

The influenza and corona virus families, which cause the flu and "colds" respectively, are medically interesting because they keep mutating, versus, say the measles virus, which doesn't. That is why you can only ever get the Measles once, or only need a few measles vaccinations to give you lifetime immunity, whereas you can catch a cold or the flu every year.

 

So, because the influenza and corona viruses keep mutating, we are basically running this ongoing evolutionary lottery. Every once in a while a strain will emerge that has a higher rate of infection, or mortality, or in the worst scenario, both. For example, the Spanish Flu, the Flu outbreak of 1957, SARS, H1N1, MERS, etc.

 

These outbreaks matter, and tracking them and preparing for them is akin to tracking hurricanes. Sometimes the public balks at the imprecision - "Last time you told us a hurricane was coming, we all evacuated and then it veered off into the Ocean!" - but I don't think we should discard the science or the concern of those in the field.

 

A highly infectious, severe coronavirus is a major issue. Containing it should be a major priority. That is not alarmism, it is just common sense, just like preparing for a category 5 hurricane. We know that covid-19 (the "coronavirus") is a highly infectious, severe virus, even though we may not know exactly how severe because of the reporting issues. It is not like a cold or the regular seasonal flu. When was the last time you heard of a 34 year old health care worker dying after catching a cold? https://www.nytimes.com/2020/02/06/world/asia/chinese-doctor-Li-Wenliang-coronavirus.html

 

There is more than enough data for governmens and health systems to be concerned, but of course there is no need for alarm.

 

Both the flu and coronavirus are droplet spread; they are not airborne. That is a huge advantage. That means you have to get a droplet of spit from an infected person somehow into your respiratory system by either rubbing that droplet of spit into your eye, or breathing it in, to become infected. So common sense hygiene practices like covering your sneezes and coughs, frequently washing your hands (especially before rubbing your face and eyes), and standing back from people who are clearly sick will go a long, long way to preventing spread.

 

That being said I am a proponent of quarantining and trying to isolate clusters as soon as we identify them as long as that is feasible. Once we have general spread, that strategy will no longer work, but we should forestall general spread for as long as possible. Folks who try to minimize the severity by saying "it's no big deal, my friend got it and he just had a runny nose" are missing the bigger picture, imho.

 

We will most certainly get through this, I have no doubt of that. But I hope we can aim for more than just getting through it, and come out the other side knowing we minimized the excess morbidity and mortality this virus could have caused by taking the appropriate actions on a national, regional and individual level.

 

That's about all I have to say about this virus. Hopefully it veers off course and ends up in the ocean!

 

M.

 

 

 

[Liberty]

I was at Costco today and it seemed like most people were wiping their carts down.

 

I bet the number of deaths from the common flu will decline, and those lives saved won't go reported as an offsetting headline.

 

Yeah, there's going to be a win from the hygiene awareness. Hopefully it's long-lasting, and maybe even it becomes part of western culture that when you're sick, you stay home or wear a mask in public and don't contaminate everybody needlessly.

[Liberty]

If anyone worried that the people in charge have it under control, rest assured:

 

[JRM]

If anyone worried that the people in charge have it under control, rest assured:

 

 

Our stable genius is three chess moves ahead of everyone else.

[RichardGibbons]

Pushing the infection rate curve down could make a big difference if seasonality matters for this disease. Viruses tend to not like warm summer weather.  If that's true of Covid19, delaying infection be even a few weeks could make a massive difference if the disease effectively becomes far less infectious during the summer. It would mean less strain on healthcare resources and would provide much longer runway to work out treatments/vaccines.

 

I wonder if the people who don't see value in preventative measures simply don't understand exponential growth (compared to little growth in healthcare capacity). But maybe I'm wrong, because that would be an odd thing for people on investment site not to understand.

 

[Guest cherzeca]

everyone on this site understands preventive measures.  but you have gov inslee of Washington State actually contemplating exercising state police/health emergency powers to prohibit people from attending events like weddings, concerts etc.  effing excuse me?  so again, this panic is out or proportion to risk.  and methinks thereby creating an investment opportunity. 

[Guest]

I can't help but link this to 2008 (for better or worse). Subprime contained, virus contained. How bad could this small part of the mortgage market affect the broader economy? How would something like the flu wreck the economy?

 

I'm simply looking at it like this. There seems to be a lot of excess in debt markets (loose terms) a lot of corporate buybacks (usually a bad sign), money losing companies for years and years now. This could get quite ugly. Like I said previously, I'm mostly invested but have cash.

 

Not sure how frequently Sequoia warns but this is noticeable, I think:

 

https://www.axios.com/sequoia-capital-calls-coronavirus-the-black-swan-of-2020-1b908823-989d-4f55-b526-aac846cbcd65.html

Modify message

 

[Guest cherzeca]

this is absurd:  https://www.cbssports.com/college-basketball/news/spectators-will-be-banned-at-ncaa-division-iii-basketball-tournament-games-at-johns-hopkins-due-to-coronavirus/

 

[woltac]

A lot of data in one place:

 

Coronavirus COVID-19 Global Cases by Johns Hopkins CSSE

 

https://gisanddata.maps.arcgis.com/apps/opsdashboard/index.html#/bda7594740fd40299423467b48e9ecf6

[Gregmal]

I was at Costco today and it seemed like most people were wiping their carts down.

 

I bet the number of deaths from the common flu will decline, and those lives saved won't go reported as an offsetting headline.

 

Yeah, there's going to be a win from the hygiene awareness. Hopefully it's long-lasting, and maybe even it becomes part of western culture that when you're sick, you stay home or wear a mask in public and don't contaminate everybody needlessly.

 

Doesnt this kind of bode well then for peoples attention and preparedness for corona?

[Guest cherzeca]

I was at Costco today and it seemed like most people were wiping their carts down.

 

I bet the number of deaths from the common flu will decline, and those lives saved won't go reported as an offsetting headline.

 

Yeah, there's going to be a win from the hygiene awareness. Hopefully it's long-lasting, and maybe even it becomes part of western culture that when you're sick, you stay home or wear a mask in public and don't contaminate everybody needlessly.

 

Doesnt this kind of bode well then for peoples attention and preparedness for corona?

 

was thinking that usually people stay home with flu because they feel sick. all about them. now maybe add to that a part of civic duty, maybe even a little empathetic mindset, to avoid infecting others.  nah, maybe not...

[Gregmal]

I can't help but link this to 2008 (for better or worse). Subprime contained, virus contained. How bad could this small part of the mortgage market affect the broader economy? How would something like the flu wreck the economy?

 

I'm simply looking at it like this. There seems to be a lot of excess in debt markets (loose terms) a lot of corporate buybacks (usually a bad sign), money losing companies for years and years now. This could get quite ugly. Like I said previously, I'm mostly invested but have cash.

 

Not sure how frequently Sequoia warns but this is noticeable, I think:

 

https://www.axios.com/sequoia-capital-calls-coronavirus-the-black-swan-of-2020-1b908823-989d-4f55-b526-aac846cbcd65.html

Modify message

 

This is certainly valid, but I think the broader financial system being knee capped and liquidity constrained is significantly different from the current environment and its potential fallout. Mainly because the two areas most directly effected, IMO, retail and energy, have already been decimated and gone through rugged bear markets. So it isn't as though we are swinging peak to trough like financials did in 07. Additionally, largely because we have a president quite concerned with the stock market, we will likely see stimulus pumped out, probably even at a faster rate than necessary. There will be casualties, but this isn't a system wide issue. Economically its pretty contained. Maybe you see a bit of stress in the CRE markets, but again, we've already got a bunch of this baked in over the years. How far do they go? 10% cap rates with a .7% 10 year?

 

Granted, I acknowledge how short sighted and petty Wall Street can be. But you've got so much cheap money still sloshing around in the system and an accommodative Fed that its hard to see everyone just all of a sudden decide they won't touch assets at any price. Which again, completely ignores the fact that China is steadily ramping back up and the current retail environment according to several recent surveys, is still quite robust.

[SnarkyPuppy]

The uncertainty is definitely part of what makes this tricky from a public policy perspective.

 

The influenza and corona virus families, which cause the flu and "colds" respectively, are medically interesting because they keep mutating, versus, say the measles virus, which doesn't. That is why you can only ever get the Measles once, or only need a few measles vaccinations to give you lifetime immunity, whereas you can catch a cold or the flu every year.

 

So, because the influenza and corona viruses keep mutating, we are basically running this ongoing evolutionary lottery. Every once in a while a strain will emerge that has a higher rate of infection, or mortality, or in the worst scenario, both. For example, the Spanish Flu, the Flu outbreak of 1957, SARS, H1N1, MERS, etc.

 

These outbreaks matter, and tracking them and preparing for them is akin to tracking hurricanes. Sometimes the public balks at the imprecision - "Last time you told us a hurricane was coming, we all evacuated and then it veered off into the Ocean!" - but I don't think we should discard the science or the concern of those in the field.

 

A highly infectious, severe coronavirus is a major issue. Containing it should be a major priority. That is not alarmism, it is just common sense, just like preparing for a category 5 hurricane. We know that covid-19 (the "coronavirus") is a highly infectious, severe virus, even though we may not know exactly how severe because of the reporting issues. It is not like a cold or the regular seasonal flu. When was the last time you heard of a 34 year old health care worker dying after catching a cold? https://www.nytimes.com/2020/02/06/world/asia/chinese-doctor-Li-Wenliang-coronavirus.html

 

There is more than enough data for governmens and health systems to be concerned, but of course there is no need for alarm.

 

Both the flu and coronavirus are droplet spread; they are not airborne. That is a huge advantage. That means you have to get a droplet of spit from an infected person somehow into your respiratory system by either rubbing that droplet of spit into your eye, or breathing it in, to become infected. So common sense hygiene practices like covering your sneezes and coughs, frequently washing your hands (especially before rubbing your face and eyes), and standing back from people who are clearly sick will go a long, long way to preventing spread.

 

That being said I am a proponent of quarantining and trying to isolate clusters as soon as we identify them as long as that is feasible. Once we have general spread, that strategy will no longer work, but we should forestall general spread for as long as possible. Folks who try to minimize the severity by saying "it's no big deal, my friend got it and he just had a runny nose" are missing the bigger picture, imho.

 

We will most certainly get through this, I have no doubt of that. But I hope we can aim for more than just getting through it, and come out the other side knowing we minimized the excess morbidity and mortality this virus could have caused by taking the appropriate actions on a national, regional and individual level.

 

That's about all I have to say about this virus. Hopefully it veers off course and ends up in the ocean!

 

M.

 

Just wanted to say thanks for taking the time to write this, I appreciated it. 

 

On a somewhat related note, what does everyone think of the following twitter thread?

 

I'm simply an observer at this point and have no conviction in either direction - but am of the mindset that proper risk mitigation (and basic common sense) dictates to act in the most conservative manner in a scenario where there is 1) incomplete information 2) a non-0% probability of catastrophic scenario.

 

 

[Read the Footnotes]

https://www.businessinsider.com/presentation-us-hospitals-preparing-for-millions-of-hospitalizations-2020-3

 

As part of the presentation to hospitals, Dr. James Lawler, a professor at the University of Nebraska Medical Center gave his "best guess" estimates of how much the virus might spread in the US.

 

Lawler's estimates include:

 

    4.8 million hospitalizations associated with the novel coronavirus

    96 million cases overall in the US

    480,000 deaths

    Overall, the slide points out that hospitals should prepare for an impact to the system that's 10 times a severe flu season.

 

Here's the slide:

https://i.insider.com/5e62a449fee23d58c83a9e62?width=1300&format=jpeg&auto=webp

 

 

[Spekulatius]

We May have to rethink when we state that China screwed up their response to the epidemic.

https://www.nytimes.com/2020/03/04/health/coronavirus-china-aylward.html

 

I think the screwups occurred early on but once they got going, it looks like the Chinese government really pulled all the stops. Also for now, it seems like China has stopped the spread out side of Wuhan, which to me seems like an amazing feat. Seems that the government can do quite a bit.

 

Another I interesting tidbit is that asymptotic virus carriers don’t seem to spread the disease. That’s good news for containment.

 

This fact alone is amazing:

Fifteen million people had to order food online. It was delivered. Yes, there were some screw-ups. But one woman said to me: “Every now and again there’s something missing from a package, but I haven’t lost any weight.”

[benchmark]

We May have to rethink when we state that China screwed up their response to the epidemic.

https://www.nytimes.com/2020/03/04/health/coronavirus-china-aylward.html

 

I think the screwups occurred early on but once they got going, it looks like the Chinese government really pulled all the stops. Also for now, it seems like China has stopped the spread out side of Wuhan, which to me seems like an amazing feat. Seems that the government can do quite a bit.

 

Another I interesting tidbit is that asymptotic virus carriers don’t seem to spread the disease. That’s good news for containment.

 

This fact alone is amazing:

Fifteen million people had to order food online. It was delivered. Yes, there were some screw-ups. But one woman said to me: “Every now and again there’s something missing from a package, but I haven’t lost any weight.”

 

One thing that's alarming is that he seems to think that the death rate is really 1-2%. I always thought that there are lots of unreported cases... :(

[Dalal.Holdings]

https://www.businessinsider.com/presentation-us-hospitals-preparing-for-millions-of-hospitalizations-2020-3

 

As part of the presentation to hospitals, Dr. James Lawler, a professor at the University of Nebraska Medical Center gave his "best guess" estimates of how much the virus might spread in the US.

 

Lawler's estimates include:

 

    4.8 million hospitalizations associated with the novel coronavirus

    96 million cases overall in the US

    480,000 deaths

    Overall, the slide points out that hospitals should prepare for an impact to the system that's 10 times a severe flu season.

 

Here's the slide:

https://i.insider.com/5e62a449fee23d58c83a9e62?width=1300&format=jpeg&auto=webp

 

Allow me to break my vow of silence with another "useless" chart. I know these charts are "useless" and "noise", so please excuse me.

 

A riddle for you supposedly intelligent individuals on here who claim to understand compounding: each dot on this chart represents a day, the last one 3/7 which is not over yet:

 

What is the doubling rate of cases ex China on this "useless" chart?

 

According to this hospital slide, they are estimating 7-10 days doubling time. Does the doubling time look a lot smaller than 7 days to you on this chart? What do you think will happen when the reality is worse than the worst case hospitals are prepping for? And remember, a lot of cases are missed (not on this chart) because places like the U.S. don't have enough test kits...

[Guest Schwab711]

 

Not at all scientific but results seem similar to trends in this thread

[maxthetrade]

Taiwan seems to be very efficient in containing the outbreak, this article is in german but you can translate it via google: https://www.focus.de/perspektiven/covid-19-ausbreitung-verhindert-von-china-und-who-ignoriert-taiwan-weiss-wie-corona-ausbruch-eingedaemmt-werden-kann_id_11742992.html

 

[Peregrine]

We May have to rethink when we state that China screwed up their response to the epidemic.

https://www.nytimes.com/2020/03/04/health/coronavirus-china-aylward.html

 

I think the screwups occurred early on but once they got going, it looks like the Chinese government really pulled all the stops. Also for now, it seems like China has stopped the spread out side of Wuhan, which to me seems like an amazing feat. Seems that the government can do quite a bit.

 

Another I interesting tidbit is that asymptotic virus carriers don’t seem to spread the disease. That’s good news for containment.

 

This fact alone is amazing:

Fifteen million people had to order food online. It was delivered. Yes, there were some screw-ups. But one woman said to me: “Every now and again there’s something missing from a package, but I haven’t lost any weight.”

 

Some of the tidbits in the article are mind-boggling. The CT scans did 200+ a DAY whereas over here we'd be lucky to see 10 a day.

 

China's ability to carry out a wide coordinated move at scale with insane speed and efficiency is unmatched.