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Unsanitized: The COVID-19 Report for Sept. 3, 2020

The State of the Virus
Plus, change to jobless numbers masks escalating damage

 

Signs welcome residents to a coronavirus testing site in Waukee, Iowa.
(Charlie Neibergall/AP Photo)

First Response

It's hard to believe that something as world-shattering and
culture-breaking as the coronavirus can be overshadowed and downplayed
in American life. Over 180,000 people have died. The economy has been
battered. It remains the story of a lifetime. And now it exists on a
lower tier.

You'd think, from the indifference, that everything that can be said
has been said about COVID-19. But the trajectory of the virus continues
to change, and likely will until there's a vaccine, treatment, or
rapid test that keeps people safe. Only five states
, clustered in the Northeast and New
England, are on a solid path that enables the resumption of something
approaching normal life. (As we've seen from Europe
,
however, any wider relaxation of restrictions will lead to a resumption
of case counts.)

Where the trouble spots were once in the South and West, however, now
the Midwest is flashing red
.
This was one of the last regions to not get hit by the spread of the
virus, and you can view it almost as the introduction of the disease,
six months after it arrived. In particular, the Plains region north from
Oklahoma up through the Dakotas is a problem.

In one sense that's not surprising. We saw the first death from the
Sturgis biker rally
that took place in
South Dakota, and that state is now among the highest in the nation per
capita for new cases, and the highest
by one count.

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The virus appears to be gaining in Midwestern college towns like Grand
Forks, North Dakota and Ames, Iowa, where thousands

of Iowa State University students and faculty are either sick or in
quarantine. Residence halls, classrooms, and parties have become magnets
for the virus.

The mitigation measures in these states are light, if they exist.
Governors in the Dakotas and Iowa are disinclined to impose much of
anything on the population. As the spread is already uncontrolled, you
can expect it to thrive in that environment. These are enormous
population centers, which helps, but the virus will surely burn through
there, as it has elsewhere.

Nationally speaking, yesterday's count
of 30,409 new cases was the lowest
since June 22. We still had over 1,000 Americans die, though that was a
good trend week-over-week, where the seven-day tracker is now under
1,000, as it has been for the past two weeks.

The good news there is that anti-inflammatory steroids have proven
successful

in reducing mortality, reducing deaths by about one-third compared to
the alternative. Though we had a possibly equivalent amount of virus in
the nation in July compared to April, deaths never approached that
terrible April level, and stalled out at roughly half that rate. As I
had said, better treatments would make a difference several months into
the crisis, and our health system has responded.

The problem is that the steroid treatment really only affects mortality
in late-stage patients. We have nothing that stops people from getting
sick. As people move indoors in cooler weather, the threat of more
spread (and economic depression as the innovation of outdoor dining, for
example, becomes untenable in much of the country) looms. Flu season's
resumption could compound matters.

We are not close to being done with the virus, even if it isn't
infecting or killing quite as many people as before. Last year, news of
something taking away a thousand people every day would rightly be seen
as a catastrophe. Now it's just "2020." We cannot become deadened
to this reality.

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'Tis the Season, Or Not

When the Labor Department counts job numbers, they add a "seasonal
adjustment" to the final figure. Layoffs follow a pattern; every
holiday season there's a surge of hiring, and every January loads of
lost jobs, for example. So each week in the series has a seasonal
adjustment based on past experience.

Past experience does not tell us much about the pandemic economy. So the
Labor Department ditched the seasonal adjustment
.
Starting with today's first-time jobless claim, the headline will
reflect the actual number of claims last week, not the seasonally
adjusted number. Prior weeks were not revised, so the possibility
emerged of a number that looked like progress when it wasn't.

That's exactly what happened. The prior week's first-time claims
number was 1.01 million, and this week's headline number

was 833,352. Sounds good! Except last week's number was seasonally
adjusted. The real number was 825,761. So first-time claims went up.
Total initial claims, in fact, have risen every week for a month
.

The continued claim number, meaning people still filing for
unemployment, sits at 29 million
. This is
the fifth week that the $600/week enhancement has not been available for
the unemployed. According to the Century Foundation
,
only seven states have begun to pay out the Lost Wages Assistance
program of $300/week that Trump ordered last month. Those seven states
represent 15 percent of unemployed workers. By the Century
Foundation's estimate, $3.85 billion has been spent on LWA, and if the
$600/week had been extended through this period, it would have paid $68
billion. So that's over $64 billion out of what the unemployed have
been using as wages. I don't know exactly when we'll see this show
up in consumer spending, poverty, debt default, and food assistance
data, but it will.

It's another example of how the haves and have-nots have grown even
wider

in this economy.

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Today I Learned

* I was on the Lawyers, Guns, and Money podcast with historian Erik
Loomis talking about my book Monopolized. Listen here
.
(Lawyers, Guns and Money)

* Record corporate bond issuance
for a
calendar year, and we just started September. The Fed bailout continues.
(Financial Times)

* More on the corporate bond rush
, including a
cameo from me. (CFO Dive)

* Meanwhile, United, one of those bond (and bailout) recipients, plans
to cut 16,000 jobs

next month. (Wall Street Journal)

* Business bankruptcies are on the cusp of soaring

right as voters make their choices in the election. (Politico)

* I've been told that states are being asked to prepare for a vaccine
in October. This story

puts the date at November 1, two days before the election. (New York
Times)

* Maybe the Pelosi blowout was a setup
,
but the judgment remains suspect given who she is. (Los Angeles Times)

* Silvio Berlusconi has coronavirus
.
(The Hill)

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