One week ago, when looking at the growing divergence between the number of new coronavirus cases in the US and shrinking number of fatalities, we referred to Nordea’s strategist Andreas Steno Larsen, who observed that “we are entering “crunch time” on fatalities since they should start to rise in early July given the lead/lag structure versus new cases.”
As Larsen further predicted, “if fatalities don’t spike early in July, then people will conclude that it’s probably spreading amongst a part of the population that is not as sensitive, or that it is a resulted of increased testing or that the virus has become less deadly as we move into the summer months. Governors in Texas, California and Florida seem to have concluded that the below correlation holds, but the jury is still out.”
His conclusion was that “the next 6-10 days will be crucial.”
Well, one week later, we decided to follow up on the current status and… there is still no spike in fatalities at either the federal level…
… or even state level as can be seen in the Florida cases vs deaths chart below:
Meanwhile, as cases appear to be plateauing in several states, not only are deaths not inflecting higher but are at the lowest level since March.
So were most experts wrong that the surge in cases would also lead to a spike in deaths?
While we are debating that question, here’s another one: back in late March and early April, consensus emerged that unless the first coronavirus wave is contained, it would result in an even more acute and deadly second wave. Why? Because both professional and armchair epidemiologists were using the Spanish flu as a case study as shown in the following chart from JPMorgan. – READ MORE
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