INDIA – 2020/07/04: In this Photo illustration a logo of Covaxin seen displayed on a smartphone with … [+] a Coronavirus logo on the background. Indian company Bharat Biotech claimed to be invented the vaccine of Covid 19 name COVAXIN and approved for Trial on Human as approved by Indian Council of Medical Research. (Photo Illustration by Avishek Das/SOPA Images/LightRocket via Getty Images)
SOPA Images/LightRocket via Getty Images
COVID-19 cases are growing fast in large parts of the US. The same folks who said the virus would just go away now say not to worry because fewer people are dying.
A lower mortality rate helps, but it’s still too high. The sheer number of sick people is straining hospital capacity some places. Viruses don’t care what anyone thinks; they just spread until something stops them.
Fortunately, scientists are learning how to reduce risk with fewer economic side effects.
The funny part: This knowledge isn’t all coming out of laboratories. It’s the result of unplanned, large-scale experiments on people who didn’t even know they were “test subjects.”
But whatever the source, we’d better pay attention. It offers a way out of this mess.
Photo: AFMC
Outdoor Conditions
Following the May 25 killing of George Floyd by Minneapolis police, large protests erupted around the country, featuring exactly the kind of crowds experts had called dangerous even with masks. More virus cases seemed likely.
We know the COVID-19 virus incubates for up to 14 days after exposure. So if the protests caused significant virus spread, it should be evident by now in Minnesota, where the initial protests occurred.
Here’s the data.
Chart:Worldometers.com
Minnesota’s average daily case count, which had been declining, turned slightly upward in mid-June, about three weeks after the protests began. These could be infections acquired at those events.
However, Minnesota’s case growth was still minor compared to Florida and Texas over the same period. Other places with large protests, like New York and Washington, DC, saw flat or declining infections.
That suggests the virus doesn’t spread easily outdoors if people take simple precautions, like wearing masks. Many protestors did and it seemed to help.
But the virus clearly is spreading. If the protests didn’t cause it, what did?
Hazardous Bar Tabs
The governors who let businesses begin reopening in May probably didn’t think of it as “research.” Nor did their citizens want to be guinea pigs. But that’s what happened.
State reopening guidelines tried to address what we know: Crowds are hazardous. Masks and distance are the best solutions. But that’s hard in places like restaurants and bars. You can’t eat or drink through a mask.
So states required those businesses to operate at reduced capacity and maintain separation between parties. This was supposed to get them back in operation while minimizing infection risk.
That was weeks ago. Millions of people have now eaten in sit-down restaurants, and the data doesn’t look good.
Photo: Twitter
JPMorgan Chase
JPM
, a large credit card issuer as well as an investment bank, analyzed spending data for its millions of customers. It shows the businesses where people used their cards. It also shows whether the card was physically present or the transaction occurred online.
They found a high correlation between “card-present” restaurant spending and higher COVID-19 cases in the same state three weeks later. More telling, the data showed fewer cases in places with higher grocery store spending (and, presumably, more meals at home).
As we always say, correlation isn’t causation. But this suggests a connection, at least.
Governors like Greg Abbott (R-TX) appear to see it. He recently ordered bars closed and kept restaurants at 50% capacity. We will know in a few weeks if it helps.
There’s also evidence air conditioning could be a factor, in part because it encourages people in hot climates to stay indoors where the virus thrives. That seems to fit the timing, too. Cases declined in the southern US during moderate spring weather, but are now rising as summer heats up.
It also raises a question for fall, when many schools and colleges plan to resume in-person, indoor classes. That may not be a good idea.
Photo: Pikist
Winter Is Coming
Let’s review what these accidental experiments revealed.
Outdoor gatherings, even large ones, don’t necessarily spark virus outbreaks.
Close, extended indoor gatherings without masks look like a problem.
No one thinks this virus will just “go away.” Life will be different until we get better treatments and/or a vaccine. But if these two points are correct, they offer some partial solutions.
For one, we might be able to resume some outdoor activities (concerts, sporting events) with a few modifications. Parks and beaches could be manageable risks if everyone will cooperate (which is hard, I know). This would help restore economic activity.
More broadly, spending our time outdoors this summer and fall might reduce the spread enough to make indoor life safer when winter arrives. It could have other benefits, too, as I described back in 2018 (see No Shoes, No Shirt, More Money).
On the downside, this is a serious blow to businesses that depend on indoor crowds—not just bars and restaurants but also airlines, casinos, and many retailers. Plus their employees and suppliers.
Some may be able to adapt, but not most. They will probably need additional government support to survive. That will be more feasible if we can stop throwing money in all directions and be more precise about who needs it.
The pandemic is still serious. That shouldn’t stop us from doing what we can to cushion the blow.
My partner John Mauldin predicts an unprecedented crisis that will lead to the biggest wipeout of wealth in history. Most investors are unaware of the pressure building right now. Learn more here.
OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
