“The Delta variant is speeding past sluggish global vaccination efforts, likely bringing a brutal summer of infections across dozens of countries – even in some nations with plentiful vaccine stocks.” (Johns Hopkins Bloomberg School of Public Health Global Health NOW: “Covid-19 ‘on Steroids’; Third Wave Rising in Africa; and the ‘Explosive Combo’ of Forest Fires and Covid-19,” June 17 email to subscribers. To subscribe, see https://www.globalhealthnow.org.)
Even as we celebrate the summer solstice, we are not happy about what requires our attention this June Sunday. We reckon today with the fact that the Delta variant of SARS-CoV-2 (also known as B.1.617.2, first detected in India) is spreading rapidly in the United States. The country faces this spread while many, many states have eliminated high-frequency data gathering, don’t report testing, or don’t do enough serology to track the variants in their particular states or regions; and therefore the information source for public health in the United States in half of the country is now equivalent to driving by looking through the rearview mirror.
Here are bullets to consider as you deliberate both personal circumstances and potential implications for the economy and investing:
· Delta is 2x+ more contagious and potentially more severe than COVID as we knew it last year.
· Its share of cases in the US is more than doubling every two weeks.
· We have to extrapolate from partial and significantly delayed data.
· Initial or mild symptoms can be mistaken for allergies or a cold.
· Scattered local reports are beginning to capture its spread but do not offer a complete picture.
· The UK is a few weeks ahead of us with Delta and is a model to watch
We reckon today with the fact that the Delta variant of SARS-CoV-2 (also known as B.1.617.2, first detected in India) is spreading rapidly in the United States. The country faces this spread while many, many states have eliminated high-frequency data gathering, don’t report testing, or don’t do enough serology to track the variants in their particular states or regions; and therefore the information source for public health in the United States in half of the country is now equivalent to driving by looking through the rearview mirror. We anticipate significant impacts.
National Public Radio offers a three-minute overview of what we know about the Delta variant in the US, succinctly covering the essentials. “CDC Has Declared Coronavirus Delta Variant a ‘Variant of Concern’” https://www.npr.org/2021/06/15/1006861794/cdc-has-declared-coronavirus-delta-variant-a-variant-of-concern
We’ll pull one quote: “The CDC estimates it already accounts for almost 13% of infections in some Southern states, like Texas and Louisiana, more than 17% percent of infections in some Northeastern states, like New York and New Jersey, and more than 25% of infections in some Western states, like Utah, Montana, Colorado.”
That’s what CDC models suggest was the case way back on June 5, based on data current through May 22. This is the page to watch at the CDC: “Variant Proportions,” https://covid.cdc.gov/covid-data-tracker/#variant-proportions. It is updated periodically, but the data lag obscures where we likely are now. To get the Nowcast model, select the Nowcast radio button. You can look at Delta variant’s share as of June 5 in various regions of the country and do some mental math to estimate where the figures might be today, fifteen days later. Note that nineteen states did not contribute data to this modeling effort because they did not sequence a minimum of 300 samples during the four-week period ending May 22, in order to do so. Those states are AL, AK, AR, DE, HI, ID, IA, KS, LA, MS, MT, NE, NV, ND, OK, SC, SD, UT, and WY.
In public health, driving based on the view through the rearview mirror is a recipe for sickness, prolonged sickness and disability, and death. It’s as simple as that.
If you want to take a deeper dive into our genomic sequencing deficit and the reasons behind it, here are two sources to consult.
“Global sequencing coverage,” https://covidcg.org/?tab=global_sequencing
“Why US coronavirus tracking can’t keep up with concerning variants,” https://www.nature.com/articles/d41586-021-00908-0
What we’ve seen and what was so well articulated by Michael Lewis in his 2021 nonfiction bestseller The Premonition: A Pandemic Story is the failure of public health in the United States at many levels. It’s not a Republican thing; it’s not a Democratic thing. It’s a both of them thing. It’s an “us” thing. And it has been evident repeatedly in the impoverished way America has addressed the evolution of the COVID pandemic, which is still ongoing and still very risky.
Let’s be blunt. Delta is a very dangerous variant. The World Health Organization (WHO) uses the term “variant of concern,” and the US CDC has, this past week, decided to do the same. “Variant of concern” is term designed not to ruffle feathers. It says, “Hey, this is something we should be thinking and worrying about, but we’re in an international political environment, so we have to use euphemistic language.”
This writer doesn’t have to use diplomatic language. Delta is more than twice as contagious as early iterations of COVID were, and evidence suggests that it may cause more severe illness. A Delta infection may present with symptoms very like allergies or a bad cold, masking its spread as people mistake it for something else and spread it all the while (“Main Delta COVID Variant Symptoms May Be Different from Original Virus,” https://www.newsweek.com/main-delta-covid-variant-symptoms-different-original-virus-1600462).
Delta is spreading in several jurisdictions. You see that spread in CDC data and modeling, and you see news popping up of outbreaks in local areas.
Illinois:
“Delta variant of coronavirus arrives in Illinois with 64 cases diagnosed,” https://www.dailyherald.com/news/20210615/delta-variant-of-coronavirus-arrives-in-illinois-with-64-cases-diagnosed
California:
“Stanislaus County ramps up vaccination efforts after detecting COVID-19 variant,” https://fox40.com/news/local-news/stanislaus-county-ramps-up-vaccination-efforts-after-detecting-covid-19-variant/
Tennessee:
“More transmissible coronavirus 'Delta' variant may be spreading in Memphis, officials say,” https://www.commercialappeal.com/story/news/health/2021/06/15/coronavirus-delta-variant-spreading-memphis/7700471002/
Colorado:
"'We’re Considering This an Emergency’: COVID Delta Variant Continues To Rise In Mesa County,” https://www.cpr.org/2021/06/09/mesa-county-covid-19-delta-variant-rising/
“El Paso County again a hot spot for new 'Delta' COVID variant of concern,” https://gazette.com/news/el-paso-county-again-a-hot-spot-for-new-delta-covid-variant-of-concern/article_e7d44798-ce34-11eb-8c53-ef4a89a6b7a0.html
Missouri:
“Coronavirus hot spots spread across Missouri, driven by variant,” https://www.stltoday.com/news/local/metro/coronavirus-hot-spots-spread-across-missouri-driven-by-variant/article_3723e2a0-9795-5a1c-992f-9c99cf88c853.html
“Missouri health officials urge continued caution as state sees rise in Delta variant cases,” https://fox4kc.com/news/missouri-health-officials-urge-continued-caution-as-state-sees-rise-in-delta-variant-cases/
You will not see such reports in all the states, but that may not mean Delta isn’t trending upward in other places, too. Many states aren’t reporting. Many states don’t even know how many cases they have and where they are. Why?
The only reliable data we now get in most or at least a large part of the country is from hospitalizations. We keep an eye on those trends. See, for example, “9 states with rising COVID-19 cases this week,” https://www.beckershospitalreview.com/public-health/9-states-with-rising-covid-19-cases-this-week.html. If you see the hospitalization rate in the United States flattening out (which is what is happening) and in some cases starting to rise (which is also happening in some areas), what you are getting is a report of infections that took place weeks earlier. You are driving by looking in the rearview mirror, and even that view is partially obstructed in parts of the country.
We’re worried about the Delta surge because so many jurisdictions have not achieved vaccination levels anywhere near what it would take to protect their populations. With regard to the Delta variant, only those who are fully vaccinated gain a high degree of protection, so the percentages of fully vaccinated people are the most pertinent figures. Further, the more contagious a virus is, the higher the percentage of people vaccinated must be in order to arrest its spread. See “States ranked by percentage of population fully vaccinated: June 16,” https://www.beckershospitalreview.com/public-health/states-ranked-by-percentage-of-population-vaccinated-march-15.html.
Two things are true about the vaccines and the Delta variant. First, and most importantly, the vaccines remain highly effective in curbing infections, illnesses, and deaths. They are critical protection, both for individuals and for populations. Second, the vaccines don’t work quite as well against this variant as they do against the Alpha variant (aka B.1.1.7) that was first detected in the UK or against early 2020 strains of SARS-CoV-2. It’s up to us to figure out whether and how we need to further mitigate risk after we’ve been vaccinated, but we need the facts to decide. Note contrasting headlines in these two reports on the same study: “Delta variant can reduce Pfizer, Astrazeneca COVID-19 vaccine effectiveness,” https://www.fox10phoenix.com/news/study-delta-variant-can-reduce-pfizer-astrazeneca-covid-19-vaccine-effectiveness; and “Two doses of vaccine highly effective against Delta variant, U.K. officials say,” https://www.nbcnews.com/health/health-news/two-doses-vaccine-highly-effective-against-delta-variant-u-k-n1270776.
So many people are celebrating the end of the pandemic and setting aside precautions. Headlines often do the same. I hope they are right, but I fear they are wrong. And the price we will pay for being wrong and letting our guard down too soon and not protecting ourselves as a society is likely to be rising sickness, partial disability from COVID, longer-term disability from COVID, and some death, predominantly among the unvaccinated. That’s what it appears is going to happen in the next weeks and months.
A useful case to watch is the UK, which has about the same percentage of its population vaccinated as the US does, though it has other mitigations in place that most US states have abandoned. Boris Johnson’s recently announced four-week delay in reopening there is expected to reduce GDP by 0.25% but to cut the Delta-driven COVID peak by 30–50%, thereby enabling the country’s health system to handle expected increases in hospitalizations anticipated to be primarily among the young. The UK is weeks ahead of where we are now with Delta, so what happens there may be a valuable indicator of what we may experience here. (“UK’s Johnson delays COVID reopening by a month, citing Delta variant risk,” https://www.reuters.com/world/uk/uks-johnson-set-announce-delay-end-covid-restrictions-2021-06-13/)
I hope you will take a minute to think about what you don’t see in the data and why a public health approach to this pandemic in lacking in your neighborhood. Why aren’t you seeing the details daily? And what would you do differently if you knew? How would you behave if you knew that in your city or your county or your state, Delta was breaking out in one or more communities? Would you change your behavior? Would you alter what you do with your family and your friends and your business so that you can you can protect the people you know, those you work with, and the ones you love?
Sometimes the truth is the hardest thing to have to absorb. And you have to pay attention and watch trends to discern it and to consider personal, economic, and investing implications. Thank you. Be safe and careful. This pandemic is not over.
David R. Kotok
Chairman of the Board & Chief Investment Officer
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