|NOËL PERRY UPDATE:
Tuesday’s numbers were up week-to-week in both cases and deaths. Most of the case increases came from Texas, Arizona, and the Other category. Much of the story is the continued effect of the long weekend.
However, new analysis shows a significant structural explanation. If you look at the third chart on Exhibit 3, you will see that all of the welcome reductions we have witnessed since late April are concentrated in the Northeast states where the contagion scored its first and biggest hits. The beginning mortality rates were almost twice the national average there – nearly two-thirds of the deaths in just eight states. Now, blessedly, deaths have declined in the Northeast to below the national average.
The Northeast data shows the now-familiar pattern of problems early, followed by a slow decline. The ‘rest’ numbers are not declining because of the heterogeneous nature of those states. Fourteen of those states have falling contagions; twelve are in the inflecting stage, while seventeen have rising contagions. We got falling national stats through much of May because the original victims were hit so hard, and their recoveries counted for a lot. Now that they are showing low numbers, the still flat numbers from the rest dominate the average. We won’t get a resumption of declines until the contagions reach herd immunity in states like California, Texas, Arizona, and North Carolina. We are hopeful that such a process will begin soon. However, some analyses, like the one we distributed from David Mackie of J.P. Morgan, postulate that increased social mobility will either retard or reverse any reductions. Results over the next two weeks will tell us if David is right.
Either way, this data and other new analyses show that we have a two-part epidemic. The early stage, concentrated in dense Eastern Cities, was unusually severe, approaching pandemic proportions, hence the lockdowns. That stage is now over, leaving us with a troubling but manageable contagion consistent with a bad year of ‘normal’ influenza. Americans seem increasingly willing to live with that risk in exchange for the return to a fully-operating economy.