Coronavirus Update 5/18/2020

By Whitney Tilson

Monday, May 18, 2020

More insightful and provocative comments from my readers…

Forgive me for not having time to reply to all of them personally!

Best regards,


Nice notes, thank you!

I admit I was skeptical when you closed your fund and opened up the newsletter. Why would someone who could run a hedge fund want to do all this work for a fraction of the compensation? I didn’t think providing a service to investors even in a lower stress environment made sense. I was wrong.

Your work on COVID-19 has been amazing and your willingness to share it is a public service. So, thank you. I really appreciate.


Your updates are excellent and are a lot of work. Thank you for all you do. Best money I ever spent becoming a member of Empire Financial and subscribing to your work. You make me think and question my views. A great gift.

Stay and well to you and your family.

I got a lot feedback to my last email about the terrible failures of Mayor Ignore My Experts, Governor Political Games, and President Drink Bleach…

Yeah – agree with all of this except for the fact that Trump has been much worse.

These 3 have all been just about equally sucky.

De Blasio the worse – terrible message/leadership and real world damage.

Trump next with the WORST possible message and “could have done some things better” – so best on my real world damage scale but by far the worst on messaging/leadership.

Cuomo between the #2 on each.

[My reply: At least de Blasio and Cuomo eventually woke up and started doing the right things, as opposed to our bleach drinking Dear Leader…]

I have enjoyed reading your work.

There may be another difference in NY and CA: different strains of the virus. See this study: Distinct Viral Clades of SARS-CoV-2: Implications for Modeling of Viral Spread.

Many have stated that the east coast strain is the same strain in Europe, while the west coast strain is the strain from Asia. One can draw many concussions as to why (like more Asians travel to Westward, and more Europeans travel East when they come to the states). I think if you ran the numbers you would see similar stats – matching S. Korea, China to Washington state and California, then compare those to Italy/Spain vs. NY. The above study supports the different strains. As with many viruses they mutate to become more virulent.

Here’s another one:

There are many articles discussing different strains, highlighting that the Asian strain (which dominates on West Coast) is less virulent, while the strain that dominates in Europe (and the East Coast) both spreads faster and has a higher mortality rate. 

It’s human nature to want to assign human blame (and I personally believe that NY was too slow to react – shift just 3-4 days earlier and you half the number of cases and number of deaths). But the differing strains is a big deal, and I’m puzzled as to why it gets so little discussion. 

I sent you link to this one a few weeks ago:

Since then there has been debate:

There is so much that is not yet known but it is common for viruses to rapidly mutate. I have been surprised at how little people seem to be concerned with mutation risk. It could possibly be much worse – or maybe the initial findings are correct that there already is a worse strain – the one in Europe and east coast U.S.

Nonpartisan comment here. The response to the coronavirus by politicians generally poor. Those who had more success were willing to listen to experts and take necessary steps sooner rather than later. Cuomo and DiBlasio do not look good at all here and Trump looks worse. 

In Canada, Trudeau has been awful, but the premiers have generally been far more willing to listen, especially John Horgan in BC. Ontario is slowly coming around. Quebec has been awful and Montreal is a DISASTER. The response spans the political spectrum – in essence, how willing the politicians are to listen to their public health experts. Newsom is now having trouble letting go as is the mayor in Los Angeles county. Tug of war between control and common sense and willingness to listen and take advice.

Credit is due to Mayor London Breed and Governor Gavin Newsom. It’s also owed to Mayor Eric Garcetti.

Sadly, while Los Angeles actually had a later start with Covid-19 disease than the San Francisco Bay Area, it has now become the epicenter for this disease on the West Coast. Thankfully it’s at much lower levels than much of the Northeast and much lower than it would have been.

Mayor Garcetti was right there with Mayor Breed and Governor Newsom in keeping California safe. He saved many, many lives in the second most populous city in the United States and led the way for Los Angeles County, the United States most populous County to do the same.

Thank you so much for circulating the ProPublica article. Cuomo and Di Blasio have been hyped up out of proportion of what was actually occurring it seems.

I learn so much from your insights.

I live in Manhattan. When I saw that video clip of de Blasio riding the subway I was shocked. At the time, I recognized it was easily the dumbest thing you could do. Sooo stupid. Why wouldn’t you just tell everyone to be safe and wear masks riding the subway as opposed to saying it’s completely safe and you have nothing to fear?

Actually, overall it really just taught me to never trust the government and to really trust your own understanding of things. Ultimately it’s kind of sad that I think this, but really it makes sense. If you think of all the responses and things they have said to the public since this has occurred (it’s safe to ride the subway as, masks do nothing, etc.) if you think otherwise you are probably stupid.

You can only trust your own reasoning in times of crisis. Everyone else has an agenda. This is the motto I will live by for the rest of my life.

Hey Whitney, if your such a god damned genius, why aren’t you running for President. It’s a bitch when all your friends in the deep state are getting exposed.

[My reply: Give me time ]

Would not be too hard on Trump it is our country’s mindset as compared to Korea who is in a prepared state. Now compare us to China who is kicking our tail in about every spot on earth. Our country needs to wake up the gravy train days are over until we get our stuff together like the 50-60’s.

Thanks for your emails. 

Just wanted to put a few cents into this conversation although I don’t have a lot of time to write a long essay. 

I agree with most of this article regarding Cuomo, DeBlasio, Trump and somewhat on Newson, but not on mayor London Breed.

Living here in Northern California, I think Newsom did a great job the first month or so, but has been lacking the leadership the past 2-3 weeks. Business people are really pissed at his ideas the past 2-3 weeks and I am including a lot of mom and pop businesses that have worked 20-30 years building a business.

London Breed however is a “total idiot” and a puppet for other people and probably taking orders from Newsom. I know plenty of people in San Francisco government and especially some of the police that have been around for 20-30 years. 

Come out to San Francisco sometime and take a sh*t in the street!

I refuse to go into San Francisco anymore unless I must go there.

I did sign up for your Partner lifetime subscription through Stansberry.

In response to my first email yesterday with Alex’s summary:

Nice job on the summary below! Let’s hope that we can find a safe and effective vaccine and more effective treatments that can be rolled out quickly so that something more like the old normal can resume. According to the Milken Institute, there are now 216 treatments and 133 vaccines in development. I am optimistic on that front but the big question is how long it will take and what the unanticipated problems may be during development. In the meantime…welcome to the new normal.

In response to Paul Krugman’s (highly political) article, Covid-19 Reality Has a Liberal Bias, which I only sent to my politics email list, two readers replied:

Feels like someone moved the goal posts. The country was told in March that the purpose of the lock-down was to keep our medical system from being over-whelmed. Other than in the NY city area, it appears that was accomplished.

Is the goal still to ensure that our hospitals are not over-whelmed, or is there a new goal now which is to keep the number of cases and deaths down? Only if it’s the latter is there a justification for continuing the lock-down, economy be damned. And if someone wants to change to that new goal, shouldn’t that be the point of discussion?

Btw…..I am disappointed that you haven’t called out the Democratic House for its inane bill to spend another $3 trillion that we don’t have. (And that’s not to say that the Reps didn’t create the problem of recklessly printing money.) But aren’t you scared to hell that the world is going to take our printing press away from us? Perhaps we all need to refresh our memory of what happened to the Weimar Republic.


Haven’t read Krugman for a while.

This is liberal bias.

There is a trade-off. Conservatives are more worried about a dead economy. It extends beyond the stock market — though the stock market is a barometer. So is 20% unemployment.

The liberals don’t care…as long as the government gives everyone the income they lost through printed money. You know, deficits don’t matter. The slow the curve to not overwhelm the hospitals made sense. But, we are now past that. 

Both the disease and a closed economy cause problems. People die from recessions, too. The left thinks the disease is worse. The right thinks the closed economy is worse.

It’s real debate with good reality based arguments on both sides.

In response to Saturday’s email with reader feedback, here’s more:

I have really enjoyed your newsletter on this. Since you have sent along some reader comments, I am passing along mine, from a physician’s perspective (I’m an MD and have an MBA as well).

I have to push back on the “it is a flu” narrative… It is NOT the flu. And this “debate” has to stop. We can have the same conversations and discussions about how to appropriately manage this without this compulsion to anchor to influenza. It is a new, distinct disease and should be treated as such. I am completely on board with the need to properly put its effects in perspective, and the vast majority of people, even those will underlying conditions WILL DO OKAY. There is also a nuanced conversation to have about what level of restriction is safe/necessary/cost effective.

But considering serious complications and protracted hospital stays (in addition to deaths), even if it occurs in just 5% of those infected, we are talking about millions of people in an unchecked scenario.

The flu has a vaccine. The flu has effective antiviral treatments available. Those who want to be protected, have a chance to do so. (This is not meant to downplay the flu in any way. Influenza is a serious disease and an ongoing public health issue – one which, as many pointed out, can be devastating even in a small number of young people. I pester my friends and family members every year to make sure they get vaccinated early.) 

There are no such preventive measures against SARS-CoV-2. How many times in your life have you seen major city hospitals overrun by the flu? (I’m not talking about simply operating over capacity, because this happens every winter with the way our hospitals are designed, but actually overrun like we have seen in NY, Spain, Italy, etc) 

Here are two resources demonstrating the stark difference between the two (again, these just touch on mortality): 

Comparison of mortality data:

And here is ICU outcomes data from ICNARC with direct comparison to prior flu seasons, stratified by age group. The outcomes are worse ACROSS THE BOARD, usually by at least a factor of two. (

Neither of these even begin to address the silent complications (again, rare) like increased stroke frequency in young patients ( or the still being research multi-system inflammatory syndrome in children. Finally, anyone who has actually looked in the EMR chart of patients will know that almost everyone has some sort of problem listed. Dismissing deaths because most patients have at least one pre-existing condition is a terrible way to look at data. I bet many of the people who have cited those statistics have one themselves…

Thanks again for your effort and commitment to furthering everyone’s education/understanding. I hope this information is useful.

I’m a recent subscriber to your email newsletter, which multiple friends recommended to me after they saw my blog post on the Coronavirus on LinkedIn and assumed we were in cahoots, because we’re blogging and tweeting out loud as we process and learn about this once-in-a-century pandemic (and associated economic crisis) that’s reshaping the world all around us.

I’m writing briefly to say “hi” but also to reply to your last two emails about the impact of the virus on younger, healthier people. This conundrum really surprises me, that so few people understand, but I think its because the media reports are mostly coming in as anecdotes, and also most people have difficulty holding 3-5 overlapping/contradictory thoughts in their head at the same time, but here’s how I see it.

  1. COVID19 is deadly – killing 0.6%-2.0% of the people it infects, depending on which serological population studies to believe/regional/demographic variations/etc. – which makes it 6-20x more deadly to an infected individual than influenza, which kills 0.1% of those who are infected
  2. COVID19’s lethality differs greatly by age group, a fact which is widely known, and which has resulted in young people and old people feeling very differently about what the proper public policy response should be (which strangely has not been sufficiently researched or reported.
  3. Now there are all these articles coming out about issues with children, deaths among healthy age health workers, etc., and it’s honestly confusing the population
  4. We know that about 15% of confirmed cases result in hospitalization and about 5% of cases end up in the ICU, also weighted towards the elderly
  5. But when there are 1.5M confirmed cases, these numbers mean our system has still seen ~40,000 “young” cases that have ended up in the hospital, and 1,432 deaths aged 45 or younger. Although small compared to the total, these are still BIG numbers that result in trending tweetstorms on Twitter and compelling stories in news publications – because they are surprising, and because they don’t conform to the norm
  6. Also, as I’m sure you are wrestling with, we’re both in the 45-55 year old age bracket … where we are 5-30x less likely to die than our peers who are older… but at the same time we’re are 3-10x more likely than our juniors to experience a debilitating case of the virus where we’d end up in the hospital, survive, but have serious debilitating problems with our lungs, kidneys, or other organs afterwards

It’s very hard for people to wrap their heads around these trade-offs.

Young people, less than 40 years old, should probably be allowed to be more free than they have been over the past 30 days, to move around, to make a living, to pursue their lives… and we need to be thinking much harder as a society about how to protect and serve those 60 years and older, who are most at risk… but it’s the 41-59 year olds who have the most to worry about catching the virus, surviving, but potentially ending up with a very debilitating disability that affects us for decades longer.

At least, that’s my current thinking as of today…

In summary: 

We can’t go back to normal.

A complete lockdown isn’t possible in America at this point (but may be needed in the future if we end up with 25 NYCs simultaneously).

Multiple smart, nuanced approaches, and open lines of communication and education are desperately needed.

Thanks for all the great work you are doing on your daily CV email; it’s become one of my main go-to sources for reliable information, and I am very appreciative. 

Here is a brief article, Comparing COVID-19, flu death tolls ‘extremely dangerous’, that is the best comparison I’ve seen of CV vs. influenza, and which makes the case convincingly that the two are very hard to compare, that they are very different illnesses, and that CV is in fact far more dangerous.

The most impressive statistical comparison in the article is the following:

“In comparison, counted deaths ranged from 351 to 1,626 during the peak week of the seven influenza seasons between 2013-2014 and 2019-2020. The average counted deaths for the peak week of the seven seasons was 752.4 (95% confidence interval, 558.8-946.1).

“These statistics on counted deaths suggest that the number of COVID-19 deaths for the week ending April 21 was 9.5-fold to 44.1-fold greater than the peak week of counted influenza deaths during the past seven influenza seasons in the US, with a 20.5-fold mean increase (95% CI, 16.3-27.7),” the authors write.”

Given all press that the false equivalency between the two diseases has been receiving, I thought that this article deserves wider distribution.

Hi Whitney, looking at your response emails is interesting.

As a retired RN and APRN who worked in a Pulmonary Specialty practice, I have read extensively on this subject. The answer may be that there are several strains if this virus, some deafly, some without much damage. You don’t know which strain you may be being exposed to. Also, many people are not aware they have underlying illnesses or are not as sturdy as they appear. The elderly are more at risk due to weakened immune status and increase in other illnesses acquired as they’ve aged. Yet as we’ve all heard, even young, seemingly healthy folk have been severely affected or died due to complications from the disease. Now infants and young children are becoming sick from the virus, though they exhibit perhaps a different set of symptoms. This virus mutates. All should be careful and conscientious. 

This Covid 19 is 3x more contagious and certain strains much more virulent than the flu (although many die from the flu as well). If your readers look into what’s happened in NYC (where I worked for 22 years), they will see how deadly this virus is. You don’t need to be panicked or paranoid, but we all need to take measures to be careful both for ourselves and for the sake of others. I could not return to work due to my severe asthma and current chemotherapy regimen.

This virus is the real deal, no doubt, but shutting down the whole country…at what cost?

Domestic violence on the rise (, kids mental health permanently effected (, and multiple reports of patients not seeing the doctor for critical (non-covid) health conditions.

We need to offer some opportunity for those that want to take the risk of socially distancing themselves to try to return to normalcy. Wear a mask, wash your hands, and socially distance. For those that don’t want to take that risk, they can stay back and wait for a vaccine. They can remain quarantined while those that need to want to take the risk and pursue their interests/careers can do so. The market is about adapting to what the market gives you. Same should be true to life around the virus. We can’t just sit here and wait patiently for a vaccine and kill likely many more livelihoods than the virus itself. We flattened the curve. Now what? Wait for a cure? That just doesn’t make sense. I haven’t heard one quantitative view from the “stay closed” folks on what they want to see before they say it’s okay to open. 

Let’s let the people decide, that’s all I’m saying. We didn’t get to where we are since the country began by sitting back and waiting for a miracle to cure all the pain. Social distancing works. Let’s try it in a real world setting that involves gradually opening up the economy. Otherwise, we sit and pray while the collateral damage is worse than the disease itself. 

Just my two cents. Everyone’s entitled to their own opinion. That’s why we have markets.

I am in the prime risk demographic for serious consequences and/or death from Covid-19. I have only one thing to say: “GROW THE HELL UP AMERICA!” 

A lockdown cannot and never will eradicate Covid or any other virus. What we are doing is delaying its inevitable spread and preventing the establishment of community immunity……..all with the childish hope that a vaccine or magic bullet therapy will save us. Our willingness to sacrifice the greatest economic engine the world has ever seen only underscores how economically illiterate we have become. The majority of our population seems to think that somewhere out there is a mystical on/off switch that will make it all better when we decide to turn the country back on again. 

Add to that the existence of substantial factions in this country that are gleefully cheerleading the collapse of the “evil capitalists.” Careful, my leftist friends, lest the words of Joni Mitchell come back to haunt all of us: “You don’t know what you’ve got ’til it’s gone.”

Just wonder what the press would be doing had Federal Government sent Covid 19 patients to nursing homes.

Your research although under the guise of independence is still plagued by partisan and ideological bias. The fish do not see the water but you swim in liberal bias.

It will be great if your research included two things:

1) All the evil brought by lock downs and quarantines. Domestic abuse, child abuse, depression, suicide, misery, disease, untreated conditions, death associated with lack of otherwise prescribed medical care. Grandparents separated from Kids and grandkids, etc.

2) Made a comparison of US outcomes excluding the tri-state area. Just look at morbidity, morbidity, and prevalence of the disease outside this region on a per capital basis and compare it with any country but China.

The future of the world depends in part on the US China relationship. Bonus points for analyzing What happened in China because this may help understand the future. Is it true they banned domestic flights from Wuhan but not to the rest of the world.

No one can be a serious financial researcher and analysts let alone give advice on investments when potential blinding biases are destroying objectivity. 

I think it is a matter of time until you make a major blunder in your recommendations given how much ideology dictates your research agenda.

Of course we all “hope” that we can defeat the virus through vaccine and/or therapeutics in short order BUT it seems to me a fool’s errand to move forward on the assumption that a medical solution will, in fact, be available soon. One of my primary investment interests is biotechnology so I have some familiarity with the phenomenal potential of what is in the pipelines out there AND I am optimistic concerning ultimate success. The timeframe troubles me, however, and I believe that we MUST open up the economy as much and as quickly as prudently possible vaccine or no vaccine!

I am curious as to your reaction to recently announced “Operation Warp Speed?” While I applaud and admire Trump’s “let’s get it done” attitude, I am more than a little concerned about the prospect of throwing hundreds of millions of dollars at 10, 12 or 15 technologies in the hopes that one will turn out to be the magic elixir. There is necessarily going to be a lot of waste there, don’t you think? 

Make no mistake, I would have little such reservation if the lethality of Covid-19 were anywhere close to what was originally projected and feared. But, does a current national mortality total well under 100,000 justify what amounts to a government blank check? At the risk of sounding callous, one of my least favorite current aphorisms is “If it saves just one life…..” Would love to get your thoughts. 

BTW: In your email letter back in the latter half of April, you made brief mention of CytoDyn. Not an investment recommendation, mind you, but a cogent reference to a stock that I had on my radar based purely on its price action. Your comment induced me to pull the trigger and I bought in @ 2.59 on April 22, 2020. Took a nice 35% profit on one-half position on April 27 and after a slight pullback am sitting on 17% profit with the other half position waiting for (what I hope will be) the third wave. So, I thank you.

Don’t you think it’s shocking that we never see a breakdown of this data by condition, and by BMI? It does appear that even those under 45 had one or more underlying conditions. If we want people to go back to some semblance of normality, we need to reduce their fear level. But to do that, we need to calculate the true probability of dying for healthy people. I will grant you that there are many people in this country who are obese, so Americans under 45 would not uniformly get the all clear.

Still there are tens of millions who are healthy, including people of our age, and wouldn’t we all dearly love to see what our TRUE risk is? ( which is why I hated that NYT article you shared. Just because a handful of healthy people get really sick should not condemn millions to stay at home if their risk is really low.)

The government successfully scared people into sheltering people in place. But now, we need to get those who are at low risk back to work, etc. To do that, we need to understand the true risk of dying by age., if we have no known underlying condition.

My point being, there is so much we don’t understand about this virus, but the one set of facts we do have is mortality and underlying conditions, and yet governments persist in releasing the data in the most unhelpful way.

Responses to my email last week about the Georgia case study:


Looking at your IFR data, you state the IFR is much higher for the elderly. The problem is, we know death from comorbidity is a large percentage of deaths, and the date from which you draw your conclusion does not separate comorbidity in an age group. Since older people are more likely to have one or more comorbidities, this inflates the IFR for the age group. But it says nothing about the IFR for HEALTHY older people.

In fact, when you back out back of the envelope comorbidity deaths, there may be little additional risk for older people. Public health people everywhere are making this mistake. I cannot find data that proves otherwise. You have been great on data interpretation. If I’m missing something, and you actually have data which shows a positive correlation between age and IFR without comorbidity, PLEASE publish it.

I enjoy your emails and you are quite well informed and appropriately analytical for a layperson.

However, when you reviewed the Georgia data, you failed to mention one very real possibility to explain the generally good outcome as the state reopens: what if the virus simply isn’t there anymore? What if it is dying out and people are no longer being infected? This isn’t to say it won’t come back as a second wave again this year or next. What we are seeing in NJ would support this possibility; the rate of “suspicious” cases being tested positive has declined precipitously, maybe 10-fold. In other words for every 100 cases in the ER that are tested, the positive rate a month ago was about 80%. Now it’s less than 10%.

If this true, then social distancing, masks, and the rest just don’t matter. Because by and large, most if not all people who are going to get infected may have already been infected?

Whitney Tilson

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About Whitney Tilson

Prior to creating Empire Financial Research, Whitney Tilson founded and ran Kase Capital Management, which managed three value-oriented hedge funds and two mutual funds. Starting out of his bedroom with only $1 million, Tilson grew assets under management to nearly $200 million.

Tilson graduated magna cum laude from Harvard College with a bachelor’s degree in government in 1989. After college, he helped Wendy Kopp launch Teach for America and then spent two years as a consultant at the Boston Consulting Group. He earned his MBA from Harvard Business School in 1994, where he graduated in the top 5% of his class and was named a Baker Scholar.

Click here for the full bio.