This report contains the information that I consider most pertinent to following the progression of the coronavirus outbreak. Information is not country-specific as this is a challenge for the whole of humanity.
As early on the progression of the outbreak in Japan was of significant interest to give an early indication of how the virus may behave in developed countries, I was providing detailed coverage for Japan, but have ceased to update the page as global developments focused attentions elsewhere.
I have no unique sources. All of this information is garnered from the internet from genuine governmental or supra-governmental sources, or from media reports (where stated).
As we sift through the implications for us and our families, please always keep a compassionate and thankful place in your heart to those on the ground in the outbreak epicentre and other responders who have their own dreams and aspirations in life. That includes my friend Dr Shi Zhengli who leads the virology research team that identified the virus and continues to work with dedication and diligence for all of our benefit.
You can learn a little more about Zhengli and how I know her in my post “Social Cohesion: The Best Vaccine Against Crises“.
I will not go through the medical or epidemiological background to the outbreak as it is readily available on the WHO website and elsewhere. Instead my aim is to provide a way to read between the lines and help the reader to understand how things are heading.
Before that I need to be clear that fools that are drawing comparisons to influenza mortality numbers and rates, to talk down the threats of this outbreak, should ask themselves whether they would like to contract this virus when there is likely at least a 2,000% greater chance of dying from it than with a severe flu (the difference between a mortality rate of 0.1% and 2%). For high risk categories of patients, the increased risk of death is greater. The actual transmissibility and mortality rates for this coronavirus outbreak really will not be understood for quite a while. But keep this in mind – if the same number of Americans that caught the flu this season experienced a mortality rate of 2%, then that would amount to 1.8 million American mortalities alone. Anybody seeking to downplay this situation should be ignored.
If anyone wants to understand why many seek to play down risks at these times, please see my post “Forget Trickle Down Economics: It has always been vacuum up to the elites“.
In the daily update I included my up to date “optimism scale”. This is a scale that can move daily depending on latest developments. Extreme pessimism of 1 would entail confirmation that the virulence of the virus is such that infections result in a mortality rate of 1% or greater (10x the virulence of severe flu) even under optimal conditions, continued indications of very high transmissibility (a reasonable proportion of infected individuals infect several people), and a lack of effective treatment and/or prevention (vaccination). An increase in optimism would necessitate clear evidence that outbreaks outside of China were being contained, evidence supportive of a virulence attenuation resulting in a mortality rate of below 1%, or strong indications of successful therapeutic treatments that can be administered widely and rapidly.
These following resources are also available:
- My open letter to Prime Minister Scott Morrison imploring him to prioritise benefits to society over economic consequences and “throw the kitchen sink” at risk mitigation;
- My recommendations to help mitigate against the possibility of becoming infected by the coronavirus; and
- The animated video of the spread of COVID-19 from the moment it “jumped species” at a live animal market in Wuhan to becoming a global pandemic (which I did in collaboration with my 11 year old son, an animation guru).
Please support my campaign for an inclusive and united humanity by signing my petition.
I am for a united humanity!
My family has donated to the #COVID19Fund to support @WHO’s response efforts to the global #COVID19 pandemic. Join us to help combat this growing global threat to people’s health and well-being: www.covid19responsefund.org
Johns Hopkins University up-to-date dashboard on COVID-19 data is here.
My optimism/pessimism level – from 10 to 1 in decreasing optimism – stable at 1 (this could be upgraded with some unexpected development, but the information emerging now globally is very concerning which confirms rapid and widespread transmission, including in well developed countries, with the clear suggestion of high mortality rate.)
WHO has stopped releasing daily Situation Reports and wisely is publishing a dashboard (similar to Johns Hopkins). As at 3:24 pm CEST 8 October, there have been 36,002,827 confirmed cases globally with 1,049,810 deaths.
Even though the WHO data shows over 36,000,000 human beings confirmed as having been infected by the virus, and the WHO suggesting that that number may only be 5% of the actual number suggesting that 10% of the global population has been infected, and over 1 million people have died with COVID-19 (the WHO suggests it is likely double that figure), news is full of the antics of just one infected person – the orange man who lives in the white house.
I am not going to waste my energy to comment other than to say two things: on Friday, including when he took his tour in front of the small gathering of “fans” outside the hospital, further endangering those salaried to obey his whims (not commands), and subsequently, he has reminded me of a 10 year old kid excited about heading out on a big adventure such is the level of his ignorance and narcissism; and I think it worth everybody considering the weight of medical intervention that was thrown at protecting this highly susceptible man to the ravages of this virus – reportedly to this point (less than 1 week post-infection) likely very early detection of infection, monoclonal antibodies, 3 courses of Remdesivir, and dexamethasone. That is an unprecedented level of care that probably nobody has previously received in the pandemic and most of the Americans who have contracted the virus, excepting the one percenters, could only dream of being fortunate enough to receive care that comes even close.
In my Coronavirus Update of 4th March I said the following:
My greatest concern is that all of the deficiencies of the US health system, that President Obama wanted to begin to address, are about to be laid bare. For all of the rhetoric about having the best health care in the world, the truth that that level of care is only accessible to the one percenters, while the average experience across American society is below that experienced in other comparable developed countries, is going to be revealed in a truly terrible manner I fear.
The problem is not the level of care that one man has received – I am very much against “an eye for an eye” philosophy including capital punishment – the problem is the strong contrast with the care received by others in the world including the many Americans who have lost their battle with COVID-19, still worried by who would pay for their treatment, while this man continually down-played its impacts to the point that distinguished medical journals are describing him as “dangerously incompetent“.
What I want most to talk about in this update is further developments on a theme that I have been discussing since late April – the risks around spread of COVID-19 with processed meat, concentrating on developments since my latest post on the subject one month ago.
As I discussed in that latest report I came across a link to some excellent research on the persistence of virus infectivity on meat – which I correctly quoted from the newspaper article as involving pork, salmon and shrimp (prawns), but which the actual research paper in pre-print showed involved pork, salmon and chicken – which reported that infectivity was maintained without loss over 3 weeks. Now I believe that these authors most likely were aware of my work drawing attention to the threat posed via this route and that this likely played a part in them deciding to conduct the study, as I stated in a post which I linked to in a comment below that pre-print, and so I have questioned whether they might consider whether that is worthy of acknowledgment. That does not detract in any way from the quality of research performed and the significance of the data.
It is highly significant that this research shows that the virus does not lose infectivity on meat over a 3 week period at refrigeration temperature or frozen. It highlights the risk that processed meat poses to spread the coronavirus geographically and to potentially cause clusters, even from meat that was stored for some period of time – perhaps after several years as another coronavirus has been shown to maintain infectivity for 2 years when frozen – even if biosecurity had been “perfect” at preventing introductions in the intervening period.
Now Australian and New Zealand’s food safety authority has been updating (as at 22 September) it’s published opinions on COVID-19, but the effect is still very much to downplay the risk of transmission to suggest that it should not be considered by consumers.
So let me expose their biases (possibly forced upon them by political interference) with one very simple statement of logic. Right from the very beginning of the pandemic – and still today, even in the aforementioned updated statement -these “experts” highlighted first that this is a respiratory virus so it is not a “foodborne disease”. However, it has been known for perhaps 100 years or more that respiratory viruses can be spread not only by inhaling droplets containing virus but by touching surfaces where those droplets settle and then transferring the virus to membranes such as in the eyes and nose. That, after all, is why one of the key management strategies stressed by all is to wash hands frequently. So what is so different about meat that it can not be one of those surfaces where the virus settles? (As I pointed out in my first writing it is my view that this is likely how at least some of the significant transmission that occurs in meat processing plants has occurred.)
Note that the published opinion is technical about what constitutes a foodborne disease – infection must be acquired through the digestive tract following consumption. This is known as a straw man strategy – set up a (false) proposition and knock it down, never acknowledging that this proposition was never what was originally claimed.
I have seen nobody, and certainly not myself, suggest that the main risk with meat was in consuming it (although I will say that this virus has a knack of surprising scientists -i.e. revealing that assumptions were made that proved incorrect – and infection in the process of ingesting uncooked foods of any form may yet be proven to present a risk). The main issue with potential infection by SARS-CoV-2 from contaminated (or infected) meat that I have been discussing is with handling it when uncooked including during food preparation.
Now this updated opinion does include some other relatively current information, much of it about how China has been responding to this threat, mostly to disparage them, and it is also draws on an opinion given by the International Commission on Microbiological Specifications for Food. With a title like that, one could be forgiven for thinking that it is a specialist group set up under the auspices of the United Nations/Food and Agriculture Organisation/World Health Organisation. No, on it’s site it says that:
Currently the Commission includes 18 members from 13 different countries: 8 members are from academia, 4 from governmental organisations and 6 from industry
The description does go on to attempt to further suggest close alignment with these supranational organisations by stating that some members have participated in their working groups, meetings and consultations, but that is a far, far cry from this being an outfit under the auspices of these important organisations. (After all, many of us can make the same point.)
For those who have experienced first-hand the many conflicts that scientists and researchers face, like these people, or if you have read my post “Politics and Biosecurity“, “On The Likelihood Of Transmission Of SARS-CoV-2 From Contaminated Meat” and even my R U OK Day post, you will note that the membership of this grouping does little to provide confidence that published opinions would be free from conflict.
Note this one piece of critical logic: the report by this grouping was published 3 September, but it failed to mention, let alone detail, the key findings that SARS-CoV-2 remains without appreciable loss of infectivity on a variety of processed meat for at least 3 weeks which was published in pre-print over 2 weeks earlier (and for which there was also articles in the mainstream media and discussion on Twitter). Even if the article was found following last minute searches prior to publication very late in the drafting process, such critical information should have been inserted in the “opinion” prior to it being published. Alternatively, if the finding was considered so significant as to require a significant redrafting process, then what is the point in publishing an “opinion” that is already out of date? That a paper was yet to be peer-reviewed, when dealing with a pathogen known to mankind for 9 months, is hardly a viable reason to exclude it entirely, after all the most powerful man in the world has just undergone multiple still experimental treatments for the disease it causes.
To say, or to use a quote from an opinion by a grouping of potentially industry-conflicted individuals, to say that “there is no documented evidence that food is a significant source or vehicle for transmission” is weak, misleading and utterly disappointing.
Again, it is another straw man argument – nobody has ever said that it is likely to be a route for a significant proportion of cases.
However, it does not need to be that for it to be a major concern in regions that have eliminated or stamped out the virus. That is why China’s approach is entirely valid, and why other nations – that have fought hard to protect their people from the extreme human costs of this pandemic – and where food security is not an even greater issue andor can be managed satisfactorily – should consider doing likewise.
In fact, very much of Australia’s animal and plant biosecurity policy is based on that very premise! Australia has a global reputation for setting a very conservative “appropriate level of protection” for animal and plant biosecurity supported by very stringent measures for the importation of animals and plants, and their products, to prevent disease and pest introductions.
So I will say again, it is a great pity when Australian politicians appear to care more for the health of our prawns and bananas (and businesses) than they do about the health of our people.
Now, having said all of that I do want to say that it appears that the state Governments have heard my calls for extra measures in meat processing facilities and have instituted a number of risk management measures which should significantly reduce the likelihood of serious outbreaks which threaten their workers and the potential for spread of outbreaks. These measures include reducing the workforce in these facilities and weekly testing for the virus in 25% of the workforce. That is excellent and should be a comfort to everybody residing in andor consuming Australian meat products, but I do note that an epidemiologist for whom I have a high regard, Prof. McLaws, is recommending that testing in high-risk workplaces should be increased.
For as long as we can have trust in the competence of our Government authorities tasked with managing the quality and safety of our meats – a standard assessment criterion in biosecurity – we can be confident that the risks associated with COVID-19 are being managed better than for many other countries. However, the paradox is that when officials understate and downplay the risks, to uphold confidence and thus minimise economic impacts on the industry and more broadly, the more they erode that trust and suggest that their actions will be less than transparent should there be important developments.
I have always also been quite concerned with butchers, for the same reasons (i.e. they are in regular contact with a product that may be contaminated with virus in the similar conditions as in meat processors), and the cluster involving the Chadstone shopping centre, and specifically a butchery, came as little surprise to me. I would note while authorities seem to suggest that the infection was brought into the premise on people, specifically a family who were contracted as their cleaners, without definitive evidence to the contrary, it is also possible that they became infected in the process of cleaning the facilities due to contaminated meat.
Moreover, I also noted these comments by Prof. Sutton, CHO for Victoria, with regards to this cluster (my emphasis):
The interactions probably would have been less than what we would call a close contact for customers. But again, you can get individuals who are very infectious. And you can be unlucky with that interaction and that’s why the callout has been to everyone who was there at that time.
I have a high regard for Prof. Sutton, and I am willing to look past known errors made by Victorian politicians at this point because I do believe that their motivation has very much been to protect human life, but these comments do reveal how lesser likely routes of transmission – such as with food contaminated by infected workers – can remain underappreciated.
On a related issue, to demonstrate just how serious can be the animal reservoir and spread issue when dealing with susceptible species, a further 1 Million mink will be culled in Denmark as the SARS-CoV-2, the coronavirus that causes COVID-19, was found to infect animals in 41 farms and is suspected in another 20 farms!
That this issue is not more widely discussed should be proof enough for just how much desire there is for the general public to not be alerted to the nature of these risks.
In “COVID-19 Elephants In The Room” which I released 10 March – think about how early in the pandemic that was – I said the following:
Something has been in the back of my mind – a nagging concern – that I did not really want to acknowledge even to myself.
This is a new viral disease to humanity. The very basics are barely understood such as what type of disease does it cause and how severe is it, how does it transfer, and how do people become unwell and how many will become so unwell that they will die. There is still very much unknown. My friend Dr Shi Zhengli only discovered the viral cause of the new pneumonia-related disease, now referred to as COVID-19, just over 2 months ago.
Now think about HIV and how long it took for scientists to get a reasonable understanding on how it caused disease in humans. Sure, our tools have improved since early in the HIV pandemic but that virus was tricky compared with other viruses then known to science.
So what has been in my mind is that the superficially apparent aspect of disease visible as the pandemic ramps up may not be the only aspect of how this virus causes disease in humans. If we were unlucky, there could be some more chronic element – perhaps more chronic disease leading to mortalities or disability, or foetal defects – who knows, almost anything is possible.
The main point of my article then was to discuss how foolhardy it would be of decision-makers to assume at that very early stage that they fully understood the risks that would be involved with not doing everything within their power to halt the progress of the pandemic, or worse, if a strategy like herd immunity from natural infection were adopted.
Since writing this there have been many surprises in the areas to which I was pointing. There have been a plethora of stories of chronic impacts from even mild infection and support groups have sprung up throughout social media. One of the most recent stories to emerge is detailed in this story on ABC.net.au entitled “Experts warn coronavirus may cause ‘wave’ of neurological conditions including Parkinson’s disease“.
Unbelievably that herd immunity debate continues as some will not give up on the concept even though many scientists are openly pointing to the catastrophic consequences of such a strategy. Even in the UK where the pandemic has raged with inconsistent and typically delayed responses, it is believed that only 8% of people are immune due to prior infection. Obviously the mathematics do not add up – at this rate it would take 3-4 more years for 60-70% of the population to have developed immunity (required for herd immunity) from having been infected – and that assumes that immunity is not lost over time, when in reality early research is suggesting that is in fact what occurs. Thus herd immunity is unlikely to ever be achieved by natural infection. To this point, with the pandemic raging in the UK for 6 months, over 40,000 Britons have died from COVID-19. At an annual rate of around 80,000 lives lost that is a very high cost indeed for a likely ineffective strategy.
For my next update I will recap the first year of the COVID-19 pandemic and outline my views on what lies ahead for next year…
Addendum: A highly significant piece of research from CSIRO has shown that the novel coronavirus can persist and remain infective on a variety of surfaces for much longer than most would have predicted (i.e. assumed) including for 28 days on glass, stainless steel and paper and polymer bank notes at 20C. (Infectivity was rapidly lost when subjected to 40C). That is hugely significant for risk management and even needs to be considered when goods travel across borders from regions with high prevalence of COVID-19 to regions that have worked hard to minimise the spread of COVID-19 andor eliminate it. Ironically, when I first mentioned that risk, in my landmark coronavirus update of 11 February, I wondered whether people might fear receiving goods shipped from China. Now one must wonder whether electronics and other products containing glass or other hard materials shipped from the US and other regions severely impacted by the pandemic may be treated with suspicion. Perhaps an idea to decline expedited shipping andor ensure packaged goods are subjected to 40C for a period prior to opening…
WHO has stopped releasing daily Situation Reports and wisely is publishing a dashboard (similar to Johns Hopkins). As at 6:31 pm CEST 3 September, there have been 25,884,895 confirmed cases globally with 859,130 deaths.
It is difficult to believe that one whole month has passed since my last “Update”. Of course, I have not been remained silent over that time writing 3 COVID-19-related posts which I consider some of my most important work:
- On The Likelihood Of Transmission of SARS-CoV-2 From Contaminated Meat
- COVID-19 Risks With Animals
- If After 30 Years of Unbroken Economic Growth Australia Can’t Afford To Protect It’s Most Vulnerable, Who Really Benefitted From That Economic Growth?
The outbreak in Melbourne has been dampened by the introduction of stringent social distancing measures but daily new cases are not yet consistently below 100. Moreover, the psychology of the situation, understanding that stringent measures will not be eased until confirmed cases fall, may be making people with only minor symptoms reluctant to be tested. That is why I agree with mass testing (initially based on pooled testing such as households, etc.) In my previous update on 4 August I spoke of my concern of a northward progression to the outbreaks, and indeed NSW is having a difficult time constraining the growing number of cases (though, being a conservative government, officials are extremely reticent to introduce stricter measures.) And in my state of Queensland authorities are throwing everything at contract tracing what seems to be increasing numbers of flare-ups. While I feel very indebted to the contact tracers, I have serious concerns that (especially) NSW is straining to sustain the effort and prevent a dangerous escalation.
I have to be honest – I am wondering whether we in Australian have been duped by conservative politicians, because I have not heard anything recently about that aggressive suppression strategy defined by an aim for zero community transmission. Instead all I hear from them is pressure, in the other direction, on loosening measures. Worse still, a recent past conservative PM spoke out in very dark Trumpian/BoJo-ian terms (which means it is definitely time to call it out in another upcoming post).
This contrasts with New Zealand which has dealt swiftly, including promptly introducing strict social isolation measures, with an outbreak centred around a frozen food importer and distributor. These measures aimed at minimising loss of life have a high level of support and their people are justifiably proud of their achievements which seem to have enhanced national confidence and cohesiveness.
On a personal note, while I have settled into my new normal, which will persist for some considerable time, and which will never return to its pre-COVID state, but will eventually settle somewhere between the two – the exact positioning largely determined by how effective are the vaccines currently under trial – I have been dealing with a persistent melancholy causing significant intraspection even though my region of Australia has had only minor restrictions over the recent months.
(I should be clear that my family’s behaviour, other than our children returning to school, has not altered greatly since March as we well understand that by the time we learn of clusters often many will already be infected, and we consider it a better psychological strategy to consider life under a COVID suppression strategy to consist of rolling periods of greater restrictions interspersed with only slightly greater freedoms.)
If I am accurate in my intraspection, the sadness that I feel is not really that my freedoms have been impacted by the ongoing pandemic. Rather it is the knowledge that humanity still suffers unbearable loss, and I remain at risk of personal loss, while the pandemic is ongoing.
We are in a flat period of waiting for news on vaccine trials – the hoped for silver bullet. Donald Trump has set a deadline of 1 November for the initiation of a mass vaccination program – conveniently before the election, but not too early before the election so that the undoubted issues will become well known.
As I said in my 23 July update, it is difficult to overstate what is at stake for vaccine companies. In investing parlance, I would describe the risks around an early vaccine delivery to be asymmetric for the vaccine companies, in that they have much more to lose from it going wrong then they have to gain from delivering it a few months earlier.
Of course President Trump only cares about the risks to his re-election.
I doubt very much that many Americans will be given the opportunity to receive the vaccine prior to their winter.
My family, like all others, are in search of some light to the end of the tunnel and I wanted to share how I have come to rationalise our future and how I have been preparing them for it as I do believe it to be one of optimism from where we currently stand if one basic condition is met – that Australia does actually prioritise protecting human life and does authentically aim for zero community transmission.
(If we were to listen to the likes of Tony Abbott, who like to pretend that only “old people” are killed by this virus – as bad as that is in itself – then our misery will certainly escalate along with case numbers and deaths as all but the most ignorant people fear loss of their own and others’ lives.)
I believe that one major key to feel optimistic about the future is to have worked hard on accepting that our pre-COVID reality is lost forever. I said it from my very first writing on the subject in February, and I said it to my family then, also. I also believe that once that has been accepted broadly within society, at that point we will have been through the worst of the psychological challenges because I am certain that things will improve from here if only because we have so much lower expectations. (Of course for some of us it will get worse as we experience personal loss, and that should never be forgotten or downplayed.)
Based on what I am hearing from vaccine experts, I think that we should prepare for (again in investing parlance, my base case is for) a vaccine ready to be administered on mass in about 6-8 months throughout much of the developed world that is around 50% effective and which will require a booster at least half yearly. If we are lucky it may be 70% effective.
I think hoping for more would be to set ourselves up for disappointment, and we also need to be prepared for a lower effectiveness for some (hopefully not all) of the earliest candidates.
I think it will be difficult to make vaccination compulsory, especially given how “new” each of the vaccines will be, especially if they have low efficacy – so lower benefit at the individual level. However, at the population level a lower efficacy level increases the importance of a very high vaccination rate. That will be a very difficult paradox for politicians to deal with.
At the individual level, those who are vaccinated will gain appreciable advantage even from a 50% effective vaccine. If I am confident that the safety protocols have been followed on the vaccine development, then I will certainly be very pleased for each of my family to have a 50% reduction in the probability of becoming infected, and then introducing infection into our household. When that probability is multiplied by the probabilities of adverse outcomes from being infected, the worst of course being death, then I see this as a significant advance for my family.
At the population level, however, a 50% effective vaccine would mean that many measures that have been introduced – by Government regulation and/or by individual choice (such as wearing of face masks) – will need to be continued to reduce the risk of infection to both vaccinated and unvaccinated individuals.
Complacency and fear will continue to drive responses by people. The hard-hearted right wing types who have been pushing for looser measures all along will seek to encourage complacency and over-confidence in the benefits of the vaccine. However, the trauma of the pandemic will mean that many will remain cautious and fearful, which to a point will be justified, but for some that anxiety may create lifelong risk aversion (as the Great Depression did for young adults who remained distrustful of banks for the rest of their lives to the point of stashing cash in their houses and even in their yards!)
The opportunity for a 50% reduction of risk is significant, and those with the capacity to logically think through risk will recognise that quickly and behave accordingly, especially if those additional risk measures are maintained. On the whole I think the population will only gradually shift away from “pandemic behaviours”, and the longer it takes to develop a vaccine with 80-90% effectiveness against the novel coronavirus, and preferably coronaviruses in general, the more long-lasting on a society-wide basis will be those “pandemic behaviours”.
To conclude, the more effective a vaccine and the higher the vaccination rate, the more measures can be loosened without increasing risk to the entire population. These reductions while being at least as safe will improve sentiment amongst the population. For that reason I do believe that for those prepared to accept that we will never go back to how things were before will find this as a source of optimism. (I will discuss in that upcoming post that this inability to let go of the past, as encouraged by conservative politicians including Tony Abbott, is holding people back from feeling greater optimism.)
Bear in mind, again, however, that all of this is predicated on the pandemic not worsening from where it is now. If that occurs, then there is significantly less reason for optimism going forward because our expectations will first need to re-base even lower.
WHO Situation Report 196 for 3 August (released 4 August Brisbane, Australia, time)
Globally: 17,918,582 confirmed cases (257,677 new), 686,703 deaths (5,810 new)
I was prompted to write an update today because my friend Dr Shi Zhengli has, for the first time in this pandemic, written in some detail about her work for an article published in “Science” magazine.
I would suggest that the article is well worth the read, but the magazine published her answers in full in a supplementary document, and I suggest that it is compulsory reading not just for those interested in more “meaty”, technical information, but to gain an insight into the personal cost paid by a group of scientists to make such a significant contribution to all of mankind irrespective of nationality or ancestry.
I truly hope that Zhengli and her group one day receive that apology, and it should be equal in sincerity to any given in the history of mankind.
Moreover, I believe that nobody would be more deserving of being named a Nobel Laureate than Zhengli.
I will also take this opportunity to discuss the current situation in Australia (not really to highlight the contrast between “Toxic Masculinity and Political Footballs“, but because there is another very important message in it).
Whether all of the current phase of the COVID-19 outbreak in Melbourne can be put down to security breaches at quarantine hotels – and I doubt that is the case – or not is more a political question then anything else because it allows the Federal Government to sheet home the blame to Dan Andrews.
The truth is that by deciding in March/April on a suppression strategy – instead of an an elimination strategy which Mr. Morrison has since adopted with a semantic maneuver placing the adjective “aggressive” before “suppression strategy” and clarifying further that the aim now is for zero community transmission – always meant that his initial decision was for Australia to have to deal with more community transmission.
As I wrote extensively on this site through the first half of this year, Mr. Morrison was little different from his ideologues in the US and UK by dithering on strong measures to minimise loss of lives out of concern for impacts on businesses. However, he had a seasonal advantage being based in the southern hemisphere with warmer weather and Australians spending more time outdoors surreptitiously lessening the likelihood of transmission.
When our heroic front line health workers dealt with the first phase of the pandemic – I won’t call it a first wave because this suggests a closed population with mostly community transmission, but in this period it was almost entirely travellers returning from overseas – and the number of new cases went down to zero in most states on most days, instead of using that breathing space to prepare for the subsequent phases of the pandemic, the Federal Government concentrated almost exclusively on economics and politically herding all of the cats towards the bright lights of a fully open economy.
At the same time the expectation of greater freedoms of movement imparted on the public, especially the younger members of society, was always going to make subsequent measures challenging to implement including from a mental health perspective. Again, these were issues that I have discussed on these pages.
The southern hemisphere winter period was always going to challenge Australia. In those weeks with low case numbers, which offered some respite to the front line responders, there should have been an enormous amount of biosecurity human capital swung into action to protect Australians from the ravages of this devastating pandemic.
While our near neighbours New Zealand have basked in a bright winter glow safe without community transmission, the COVID-19 pandemic reignited in our coolest, populous state with a vengeance unseen during the earlier period.
The current phase of COVID-19 in Australia threatens to move northward.
The concerning thing is that if there is a lot of community transmission heading into summer, evidence from the sunbelt in the US and in Spain suggest that warmer climates in developed countries may have difficulty in containing the spread, possibly due to the wide use of air conditioning systems.
I personally am relieved that Mr. Morrison has adopted an elimination strategy even if for political reasons he can not bring himself to say those words. And I know that in the role that I am attempting to play for my fellow countrymen I cannot strongly prosecute an argument highlighting that he was wrong because ultimately I have gotten what I wanted and have pushed for from my first reports in February – a Prime Minister who wants to do everything necessary to minimise loss of life – and I cannot lament too loudly the time lost.
Going forward we need to implement our enormous biosecurity human capital and infrastructure to start to be more proactive rather than reactive in our battle against COVID-19.
I am currently co-writing a paper on what I consider to be a particularly important aspect of that proactivity, and as a hint, it follows on from a theme that I have discussed in a previous post as well as my previous update on 23 July below and was touched on in Zhengli’s document.
Keep out an eye for it in the press (hopefully) and I will link to it from these pages.
WHO Situation Report 184 for 22 July (released 23 July Brisbane, Australia, time)
Globally: 14,765,256 confirmed cases (202,726 new), 612,054 deaths (4,286 new)
Watching the progress at vaccine development is like riding a real roller coaster. One day the media is concentrating on the positive news from early stage trials with a particular vaccine candidate, the next day the news is full of disappointing news that antibodies to the novel coronavirus drop quickly in people who have been infected.
I watched two conversations on Bloomberg this week that presented the best available opinion on where we presently stand. The first was with Richard Horton, the Editor of “The Lancet”, the pre-eminent medical journal, where he said that the Oxford vaccine trial went about as well as could be expected. He cautioned, however, that it is at a very early stage, and there may be other challenges faced, so best to keep expectations well in check. The second was with Dr Vasant Narasimhan, the CEO of Novartis, whose background is in vaccinology, who said that they are not going to risk rushing the vaccine because the dangers are too serious to contemplate, and data checking would take around 6 months from the completion of trials.
I had not thought of it until he said those words, but it is difficult to overstate what is at stake here for the vaccine companies who have been under attack from the global anti-vax campaign. A timely, well tolerated and effective vaccine would go a long way towards dispatching the anti-vaxxers for once and for all. On the other hand, a problem with a vaccine that is administered to large swathes of the population would be enormously damaging to the industry, especially those companies involved, and would be a boon to the anti-vaxxers. Those dangers for the vaccine companies will ensure that time will be required to ensure that all safety boxes are properly ticked and verified before any vaccine is administered en masse.
On an equally pertinent issue – yes, believe it or not there is another issue as important – since uttering “aloud” in my previous update on 30 June my concerns over whether some of our food animals may be susceptible to infection by the novel coronavirus, I have been trawling through the literature.
One development in this area was of particular concern – a mink farm in Spain culled 100,000 animals when it was discovered that 87% of animals were infected with the novel coronavirus SARS-CoV-2 along with 7 workers. The virus is believed to have entered the farm with an infected worker, and there is concern that the virus can be transmitted both from humans to mink, and from mink to humans. The same report stated that 25 mink fur farms in the Netherlands were found to have infected animals, along with 3 farms in Denmark.
This clearly is a very serious issue as it highlights the potential for other animals to act as reservoir hosts for SARS-CoV-2 and to reseed new outbreaks in humans. This is possibly the most troubling finding for COVID-19 in recent months, and that is likely why it is not being widely discussed in the mainstream.
While that is serious enough, if food animals are found to be susceptible to infection then the situation would be worse by several orders of magnitude because difficult decisions would need to be made about whether to cull infected populations, potentially causing food shortages, and it opens up the issues of food borne transmission.
Now I know nothing about the mink industry, but it would be interesting to know whether there have been outbreaks of COVID-19 in slaughter houses which processed mink and what happens to the meat which I assume is a by-product of their main purpose of fur production.
Before discussing these implications, I should spell out that early technical research on the way that SARS-CoV-2 enters the cells of its hosts (i.e. our cells) suggested that the virus would have a relatively wide host range – i.e. these studies suggested that it could infect a large range of mammal species. These studies suggested, however, that two important food animals, chickens (obviously not a mammal) and pigs, were unlikely to be susceptible to infection. However, cattle, sheep and horses were considered highly likely to be susceptible.
These studies are predictive in nature, and real world studies are required to test those predictions and they can include observations and analyses on wild and farmed populations of animals, and through experimental infections studies using both unnatural routes (i.e. inoculation by injection) or natural routes (i.e. inoculation onto membranes, or cohabitation with infected animals).
As I stated in previous reports, biosecure facilities for testing large animals for susceptibility to serious pathogens are not common but a study reported in early July failed to produce infections in pigs and chickens, but established strong infections in ferrets. These results are consistent with the earlier predictions.
Now I do not want to go into deeper detail than this, but this gives the reader enough background to really have a clear understanding of the risks that this issue present. However, if the reader wishes to conduct further research then I suggest clicking on that link above and reading especially the box “research in context”. The reference list at the end of the paper is a good start to finding additional technical information. Searching terms such as “SARS-CoV-2 host range”, “transmission studies” and “ACE analysis” (ACE refers to the mode of entry to host cells to initiate infection) will provide links to most available literature.
Obviously, if it is shown that beef and/or sheep or other meat animals are susceptible to infection then that really opens up the risks associated with dispersal of the virus geographically and over time in frozen meat. The intensity of farming is always related to the risk of disease outbreak, so beef feedlots would be especially at risk if cattle are susceptible.
Importantly, real world observations and transmission studies do seem to be confirming those predictive studies.
The lack of open discussion on this topic should not be interpreted that this is a non-issue. In reality, it is such a serious issue that Governments will avoid discussing it until it becomes necessary by events. When I worked at Biosecurity Australia, the extreme public sensitivity over the idea of pathogens being present in food – even when there was no chance that the pathogen could infect humans – was foremost in the crafting of all media releases.
If it becomes clear that some of our most widely consumed food animals are found to be infected by the most serious human pathogen to emerge in a century, then reputational damage to that industry would be enormous. That is what is at stake here (too serious for obvious puns!)
I was already concerned by the potential for contamination of processed meat by infected workers. But this suggests that it is entirely possible that the route of transmission might be the other way around, also – workers being infected by meat from infected animals. (Remember my video when that was one of the most credible pathways for the virus’ initial jump into humans.)
The broad host range of SARS-CoV-2 serves to emphasise just how unwise it is to allow this pathogen to spread in human populations without doing everything within the scope of our modern scientific and biosecurity capabilities to impede it and aim for elimination. If it becomes endemic in reservoir host species, then COVID-19 will only ever be managed in humans by effective vaccines.
Finally, just imagine the value to Australia of eliminating COVID-19 if it were found that cattle and sheep are susceptible to infection. I would not like to be a conservative Government minister explaining to the bush that the opportunity to export meat from a certified COVID-19-free region was squandered. Now that really is a major economic and political benefit from an elimination strategy!
WHO Situation Report 161 for 29 June (released 30 June Brisbane, Australia, time)
Globally: 10,021,401 confirmed cases (178,328 new), 499,913 deaths (4,153 new)
From my earliest updates I understood that these numbers would escalate exponentially, so that when I was writing single digit numbers I knew very soon it would be double digit numbers, then in the thousands, then hundreds of thousands, and then millions. Knowing and understanding does not translate to being emotionally prepared, and I cannot begin to express how sad I feel every time I write these huge numbers, or when I look back at my report of 11 February and see that there was only 1 death outside of China.
When I began writing these updates it was a very deliberate decision to leave the year off of the date. I knew this was never going to be limited to a 2020 event. I simply had no intention of writing updates beyond the first year of the pandemic because I knew it would be too depressing. My next post will detail my concern for how I believe the pandemic will play out beyond 2020, and what will be the implications for our society.
Since my previous update the new outbreak in Beijing which was associated with the finding of the novel coronavirus on cutting boards used for imported salmon in a wholesale food and seafood market has led to China enacting new requirements on imports of processed meats and some other goods. All shipments must be accompanied by certification attesting to freedom from contamination by the novel coronavirus.
I have added to my Youtube videos on COVID-19 food safety in processed meat with several videos on handling specific processed meat in various circumstances, along with a summary video discussing the risks.
Now as I have stated on that video, and elsewhere, I agree that there is ample opportunity for China to use this issue as a technical barrier to trade, firstly because many countries including Australia do that, and because of the fluid nature of geopolitics surrounding China at present. I would suggest that including soy beans (which are primarily used to feed to pigs) in the list of products requiring attestation of freedom from novel coronavirus contamination may hint at this potential. Then again, one possibility that I have not canvassed is the potential for pigs to actually be infected by the virus, and that as a potential reason for why slaughterhouses and processers to be especially impacted, thus the need to be extra careful with the feedstock given to livestock. (I do not know how much research attention has been given to assessing pigs as potential hosts – experimental transmission experiments would need to be carried out in the highest level biosecurity facilities capable of large animal trials, and they are as rare as hens teeth, and this is probably not a high priority for research.) Also, I have inspected seafood processors while working for Biosecurity Australia, though never a salmon processor, and understand these to be highly mechanised and thus likely lower risk due to lesser contact with humans and lower probability of contamination.
Nonetheless, I consider it a favour to the world to highlight the risk of the spread of this pathogen with especially processed meat, and for me the benefits of that outweigh any potential for political interference.
I have been conducting some research on what potential risks all of this pose to Australia in terms of establishing new clusters of infection with imported processed meat. Uncooked meat obviously presents the greatest risk as the novel coronavirus and other similar viruses can survive refrigeration and freezing for prolonged periods, but is quickly inactivated at cooking temperatures.
These are the current biosecurity policies for the importation into Australia of the major forms of uncooked meat for human consumption:
- Salmon is permitted entry from Canada, Denmark, Norway, Ireland, UK and US processed in those same countries plus Germany, Philippines, Poland, Sweden and Thailand.
- Pork is permitted entry from Canada, Denmark, Finland, Ireland, Netherlands, New Zealand, Sweden, UK and US if kept under biosecurity/quarantine control until processed at an approved premise.
- Beef is permitted entry only from Japan and Vanuatu.
- Uncooked chicken is not permitted entry from any country other than New Zealand and presently it is not allowed from there either.
So it is really only salmon and pork that is imported into Australia in uncooked form from countries that are experiencing severe COVID-19 outbreaks. As I stated above, based on my (albeit limited) experience in inspecting seafood processing facilities I believe that processed seafood represents a lower risk of contamination and thus transmission of the novel coronavirus than larger animals which generally use less mechanisation. On the other hand, the pathway for exposure is direct as people will take the frozen fish home and prepare it for consumption.
The import conditions for uncooked pork state that it must go straight into a quarantine approved premise for further processing. While this does not involve a pathway into Australian homes, obviously the sheer amount of uncooked meat that workers in these premises may come into contact with will increase the risk of transmission to these Australia workers. The list of premises permitted to process imported pork meat is on the agriculture department website, although the list may not be complete as inclusion on the published list is at the discretion of the business. The majority of businesses on the list are in Victoria. I would personally be interested to know whether there are any additional risk management procedures implemented at these facilities, whether they have imported uncooked meat over recent months from impacted overseas processing facilities (it is a condition of import that the premise and date of processing accompany the product on entry to the country), whether workers are undergoing additional testing for the virus (not just general symptoms), and whether workers at any of these facilities have been found positive for the virus.
Moreover, given investigations into the Cedar Meats cluster unearthed the practice of contract workers moving between different processing facilities, something that has been highlighted as a risk for spreading the pathogen, I would suggest that extraordinary care needs to be taken to ensure that workers at these facilities processing imported meat do not contract and spread the novel coronavirus.
WHO Situation Report 146 for 14 June (released 15 June Brisbane, Australia, time)
Globally: 6,690,708 confirmed cases (137,526 new), 427,630 deaths (4,281 new)
The US President shows no inclination to lead on much else other than creating division in society. Consequently the US with the UK remain the most severely impacted nations for which reasonable data collection and testing exists – i.e. amongst all but the least developed nations – although the pandemic is now out of control in South America. The latest report on the US by the Imperial College London, written before the BlackLivesMatter rallies began, showed that the US was on course for a serious escalation in the damage to its people (especially its underprivileged minorities, and it is my emphasis below):
We predict that increased mobility following relaxation of social distancing will lead to resurgence of transmission, keeping all else constant. We predict that deaths over the next two-month period could exceed current cumulative deaths by greater than two-fold, if the relationship between mobility and transmission remains unchanged. Our results suggest that factors modulating transmission such as rapid testing, contact tracing and behavioural precautions are crucial to offset the rise of transmission associated with loosening of social distancing.
Overall, we show that while all US states have substantially reduced their reproduction numbers, we find no evidence that any state is approaching herd immunity or that its epidemic is close to over.
My work on COVID-19 since last update has concentrated on developing a series of videos on food safety particularly with reference to processed meat from plants where large numbers of infected workers have the potential to contaminate the meat prior to packing. Last week I released a short form video and today I released a more detailed video. Although still working on the editing of the latter, the emerging news at the weekend out of China of a new cluster of COVID-19 at a wholesale food market and the finding of virus-contaminated cutting boards used for salmon, and then the removal of salmon from supermarket shelves, obviously prompted me to expedite the release.
I did receive a response from a federal minister to my most recent letter, but I shall not share it here because it says nothing of real substance.
WHO Situation Report 128 for 27 May (released 28 May Brisbane, Australia, time)
Globally: 5,488,825 confirmed cases (83,465 new), 349,095 deaths (5,581 new)
Since my last update I have released two major COVID-19-related reports in “Toxic Masculinity and Political Footballs” and “Your Life: Something The Elites Have Always Been Prepared To Sacrifice For Their Ends“
As I write I feel as concerned for the world as I did in February – no, worse, because then I put the inactions of the major English-speaking countries down to ignorance. Now it is clear that it is the ills of how capitalism has been allowed to develop in our countries. (Sadly, the problems of what would occur in the developing world were obvious due to inaction by the developed world over decades.)
A friend forwarded a post on Facebook that said “when a society regrets the economic loss more than the loss of life, it doesn’t need a virus, it is already sick”, and that sums up well my own feelings about the situation.
Mostly I am disappointed in myself, in my inability to be persuasive with others to ultimately have an influence on decision makers. As at writing I still have not received any reply whatsoever to my letters to decision makers.
I deeply disagree with the opening up of Australia at this point in time – heading into winter, on the verge of eliminating the virus within Australia, and with a large proportion of the community in agreement with the need for the stringent measures.
Here is as plain a statement as can be made – what New Zealand and Australia have clearly shown is that deaths from COVID-19 from this point on in people in Australia who do not travel overseas were preventable. There is a great deal of evidence now of the severe impacts of this disease on human populations, and developments since I wrote “COVID-19 Elephants In The Room” make it clear that it is indeed prudent to always bear in mind that we do not yet understand the full impacts on humanity.
To create momentum towards opening up, Morrison played a petty political game of pitting State Governments against each other over sensitive issues around schooling and borders.
If we had maintained our stringent measures in full for another 8-10 weeks we were highly likely to have succeeded in eliminating the virus from Australia, through diligent contact tracing and testing of the few cases that arose in that time, combined with very stringent international border measures. If the counter-argument, that decision-makers dare not utter publicly, was that they suspected there was already too much virus circulating in the community to feasibly be successful at elimination, then why would they lessen the measures just as we head into what all agree is the most critical season for managing the disease?
The economic and social benefits of elimination allowing the entire domestic economy and general society to open back up are so obvious and powerful that it is hard to fathom the decision to not continue on towards it. It makes no sense… except, of course, if my short post entitled “What Really Scares The Global Elite” is spot on.
More than ever I believe that the Elites fear “The Great Reset” and what it will do to their grip on wealth and power.
Their political puppets treated their societies like addicts – afraid that they would go cold turkey on their addictions to mindless consumerism and all that entails, like choosing aspiration for social standing over contributions to society through family and community, they were eager to give little tastes along the way to maintain those habits. Consequently, we will be doomed to repeated cycles of opening up which permits the virus to spread, and then we will (though what has occurred in the US suggests that the more appropriate word is “may”) go through periods of lockdown to temporarily slow the rate of spread.
What is already abundantly clear to me is that in the United States, the United Kingdom and Australia the elected decision makers did not choose “People Before Money“.
To conclude, as my post “COVID-19 And Food Safety In Processed Meat” showed, this is an emergent issue, but true to form, the decision makers seem more concerned with the economic impacts of closures rather than the public safety issues. So I am currently working on a video – or series of videos – to get to the heart of the risk factors. I will post them here, on YouTube and on Facebook, so keep an eye out.
Stay safe. I am for a united humanity!
WHO Situation Report 108 for 7 May (released 8 May Brisbane, Australia, time)
Globally: 3,672,238 confirmed cases (83,465 new), 254,045 deaths (6,539 new)
Sorry for the large gap in updating, however I have been busy writing a second letter to PM Morrison and other Ministers about growing concerns of COVID-19 infections in meat processing plants (actually before news broke of the cluster at Cedar Meats in Melbourne), writing a post on COVID-19 and Food Safety in support of that letter, continuing to stand by a friend in linking to comments on the origin of COVID-19 made on Bloomberg Television by Australia’s foremost scientist in Peter Dogherty (an immunologist and Nobel Laureate), writing to my State Premier on my concerns of opening up schools and generally before we get into mid-winter, continuing to draft my next post which I can not to decide whether to entitle (positively) “Humanity’s Luminous Future” or “Your Life: Something the Elites Have Always Been Prepared to Sacrifice For Their Ends”, reading a lot including an excellent and alarming article linking increased deaths from the 1918 flu pandemic in regions of Germany with increased support for Nazism, and trying to write constructive comments mainly at The Conversation, one of which is below, which is a high-level publication portal given that only academics can publish but I have to say that the comments, open to everyone, below this article linking another pandemic to increased xenophobic were truly alarming… and sad… thankfully some were tag for moderation.
Surely this and the previous well-informed/sourced comments just go to demonstrate for any objective person how foolhardy it would be to do anything other than try to ensure that as few people in our population are infected while hoping for a vaccine… Some say we need to open up because we cannot bear the economic cost, but we still have little idea of the full human cost and what we do know already is that it is devastating.Comment by Brett Edgerton at The Conversation on article “We may well be able to eliminate coronavirus, but we’ll probably never eradicate it. Here’s the difference“
WHO Situation Report 98 for 27 April (released 28 April Brisbane, Australia, time)
Globally: 2,878,196 confirmed cases (85,530 new), 198,668 deaths (4,982 new)
Make no mistake: we have a long way to go. This virus will be with us for a long time… Most countries are still in the early stages of their epidemics. And some that were affected early in the pandemic are now starting to see a resurgence in cases… although numbers are low, we see worrying upward trends in Africa, Central and South America, and eastern EuropeDr Tedros, Director-General, WHO
Belgium, a country of 11 million people, continues in these comparisons to be hardest hit. However, on deeper examination it appears that their leaders made the decision to be extremely transparent in their reporting and, whereas many countries are not including people who died without being tested for COVID-19, like many residents of nursing homes, Belgium is including these in their data. Some in Belgium are uneasy with this because they fear a persistent negative perception towards the country.
As I stated in my earliest writing, decision-makers in all countries will consider politics as a part of their decision making on how they report these data. When politicians lead with transparency and honesty they should be acknowledged and applauded.
Well done Belgium!
Some reports say that one-half of recorded deaths in Belgium were in nursing homes so that gives an indication on just how much other countries may be understating their data when very few of those cases are included in their numbers. There is a definite possibility that the Belgian data might even overstate the number of deaths due to COVID-19 because of this position, but it is likely to be far closer to the truth than those countries not reporting those who were not tested for the disease.
Finally, I am working on two new important posts which I hope to release in the next few days so keep an eye out for these by subscribing to my posts. Here is a teaser:
One of these entirely contradictory statements is correct, which one is it?
- Freezing is a common method to kill and inactivate viruses, and typically the faster and deeper the freeze the more effective the treatment. OR
- Freezing is a common method to store and maintain infectivity of viruses, and typically the faster and deeper the freeze the more effective the treatment.
WHO Situation Report 91 for 20 April (released 21 April Brisbane, Australia, time)
Globally: 2,314,621 confirmed cases (72,846 new), 157,847 deaths (5,369 new)
Trust us. The worst is yet ahead of us… Let’s prevent this tragedy. It’s a virus that many people still don’t understand.Dr Tedros, Director-General of the WHO
Today I have reached some decisions on how I am going to move forward, 1) with this update and 2) in my market positioning.
I am going to continue to update this page only periodically as I described on April 15 but when I do, along with the data from WHO situation report released that day, I will include these two graphs which I consider the most pertinent representation of the Johns Hopkins data (i.e. relative to population size). It reveals just how serious has been the pandemic in Spain, and surprising to me, for I had not gathered it from the press coverage, Belgium is really suffering. The UK shows similarities to France and the Netherlands. And the US has significant upward late momentum in cases showing just how foolish is the discussion of lifting social distancing measures.
As I wrote also on 15 April I had positioned aggressively tactically to profit should stockmarkets retrace back down towards their previous lows, and I took some losses unwinding those positions waiting for a better entry point. Yesterday I re-initiated that same trade – though this time with only 40% of the trade in a leveraged position, now 60% in a inversely proportional 1:1 relationship with equity markets. I am content to leave this positioning remain in place because there are no circumstances in which I would wish to take broad equity market exposure. This bearish positioning represents 50% of my total long term portfolio. Around 15% remains in 4 health care stocks which have been appreciating in the pandemic, 10% in gold hedged to Euro, less than 10% in cash for operations, and the remainder in Australian and global equities with my 2 preferred fund managers. When I trade out of my bearish equity market positions I intend to buy back into gold positions and potentially equity markets if valuations have fallen appreciably from current levels. For interest, on my short term portfolio in March (before the trough) I trimmed 2/3 of my original short portfolio returning 3,000% of the initial total cost of the full portfolio.
WHO Situation Report 85 for 14 April (released 15 April Brisbane, Australia, time)
Globally: 1,844,863 confirmed cases (71,779 new), 117,021 deaths (5,369 new)
Apologies for dropping off on this over Easter. I have to admit that I am questioning the value of doing a daily update especially with the data from WHO situation report which significantly lags the data from the Johns Hopkins Hospital which is now widely reported. Equally I do not think it adds much value me recording here what are those numbers when I happen to look at them to write a report each day as I have long provided the link and anybody interested can look for themselves.
What I have decided to do is periodically write an update as and when I have something to say about the progression of the pandemic, or the social or political situation around it, or the economic or investment implications, but when that is not sufficient to fill out a specific blog post.
So please do continue to return to see my now irregular updates.
Today I need to fess up to being caught out by Jerome Powell. In my post “Repeat After Me, This is NOT SARS: COVID-19 is Much Worse” I discussed my views on investing through the pandemic and stated that Central Bank and other co-ordination to support market pricing would complicate shorting strategies and general positioning for sharply downward moving prices. I have to admit to being surprised by just how far the initial leg down in stockmarkets went, and to having been a little premature in taking profits on my outright short positions in my short term portfolio (of course timing is always the difficulty regardless of whether talking about short or long positions).
In the same post I said that I understood why Central Bankers would respond and in unprecedented ways. But that does not mean that I felt it right that market signalling should get even further out of sync with fundamentals than had occurred since the GFC, especially in the context of the extreme challenges we face. In other words, it is reasonable that these actions smooth movements to minimise panic and shock to already anxious societies, but not appropriate to keep prices at prices devoid of reality and completely disconnected with fundamentals.
Last week I felt that the buying in stock markets was getting carried away and well out of context with the situation as I had discussed below in my April 7 update. Noting this asymmetry I positioned in my long term portfolio, mainly because option pricing for my short term remains elevated, for an imminent draw back – especially with earnings season beginning – which I felt likely would result in a retest of the mid-March lows.
I suspect that Jay Powell, the Chairman of the Federal Reserve, sensed the same and added additional timely support which has continued the bull run. I do not expect this continue for long but I needed to concede that the risk balance has altered in the short run and maintaining my slightly leveraged position would decrease the ultimate returns. Thus I sold and remain on the sidelines waiting for a better entry to the trade. Making things more difficult I used much of my gold positions to fund position, so only partially participating in the continued runup in gold prices has added to the pain.
At this stage it is worth saying that this is not how I prefer to invest. In fact, many people who I respect deeply will say this is not investing – it is speculating – and I agree with them. But those same people are either 1) tinkering on the edges themselves with this essentially momentum trading while justifying that it is about prices moving in and out of their estimates of intrinsic value; or 2) have been called out for being old fashioned and out-dated as value investors.
The reality is that Central Bankers continual support of markets have transformed them into something altogether different and their loss of value as capital allocation tools – Ben Graham’s “weighing machine” – has now been prolonged. In my own mind I equate current equity markets to those digitised phony horse races that gamblers sit around in the betting parlours and pubs gambling on. I have never been a gambler and have no interest in horses or any other form of gambling because I know I have no advantage over those setting the odds. And everybody knows that horse racing and other forms of organised “chance” have a long history of manipulation (all Australians of my age will remember the “Fine Cotton” affair where a much better horse was painted and swapped into a race – no joke!)
Current stockmarkets look a lot more like those digitised form of horse racing with Jay Powell, who likely gets on a whole lot better with Mr Trump than the deliberate manipulation of the perception of their relation infers, and other central bankers at the levers deciding on all of the parameters.
Contemporary stockmarkets are anything but free markets.
That does not mean, however, that the Central Bankers are omnipotent because the emotion of market participants is more powerful if it shifts suddenly, and this pandemic provides some confronting realities for humanity…
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© Copyright Brett Edgerton 2020