Latest U.S. and NYC coronavirus data; Coronavirus mortality by age; Debate over herd immunity; Why Are Markets So Calm About the Second Wave?; Finland vs. Sweden

By Whitney Tilson

Friday, October 2, 2020

I continue to closely follow the pandemic, sending lengthy e-mails to my coronavirus e-mail list every week or so (if you’d like to receive them, simply send a blank e-mail to: [email protected]).

Below is an excerpt from what I sent to readers yesterday, which you can read in its entirely here

I wrote this e-mail prior to hearing the news that President Donald Trump and his wife have been stricken with the virus. Even if you aren’t a supporter of theirs, this is a time to come together as fellow Americans – and human beings – and wish them a speedy recovery.

1) Overall, the news regarding the coronavirus pandemic for the U.S. continues to be OK, maybe even good… but not great.

As the next five charts show, tests are way up, new cases are flat, the number of people hospitalized is down by half (but flattening), the hospitalization fatality rate is falling, and daily deaths continue to trickle down (the seven-day average is 731, way down from the peak of 2,256 on April 21, but up from the recent low of 520 on July 5):

2) Here’s a new chart I’ve never seen before, from the Centers for Disease Control and Prevention’s (“CDC”) website: Excess Deaths Associated with COVID-19. It shows that the U.S. is now below the “average expected number of deaths” for the first time since the end of March – great news!

3) As for my hometown of New York City, there are scary headlines (New York City’s Average Positivity Climbs as Hot Spot Cases Continue to Rise), but the flare-ups are limited to a few neighborhoods.

Overall, the numbers remain excellent – with cases, hospitalizations, and deaths at extremely low levels. Here are charts from the NYC Health website:

4) It’s very important to understand that COVID-19 is essentially a non-issue for young people, whether measured by hospitalizations or deaths:

Hospitalizations by Age Group

And there have been far fewer COVID-19 deaths in the U.S. for those aged 0 to 17 (92) than from swine flu in 2009 (317) or a normal flu season (CDC data here):

CDC Estimated Deaths From COVID-19 vs. Annual Influenza (United States, Children Ages 0 to 17)

COVID-19 in 2020: 92
Flu 2018/19: 477
Flu 2017/18: 643
Flu 2016/17: 251
Flu 2015/16: 268
Flu 2014/15: 803

5) The single biggest, most important debate going on right now is whether we (collectively, the world) are close to some sort of herd immunity threshold, as Adam Patinkin and my colleagues Enrique Abeyta and Alex Griese believe. I’m not 100% sure they’re right, but I think the odds are getting better as data emerge and time passes.

The New York Times, however, is still running stories that this line of thinking is some sort of Trumpian/right-wing fringe view: Trump Allies Say the Virus Has Almost Run Its Course. ‘Nonsense,’ Experts Say. Here’s another article in Foreign Affairs along similar lines: America Needs to Lock Down Again. Lastly, this Vox article shows a scary COVID-19 rise in Europe: The new COVID-19 case surge in Europe, explained.

Here are various rebuttals to this:

6) Sweden’s approach to fighting the coronavirus continues to be highly controversial. This chart from the Financial Times shows that Finland seems to have done a much better job, with fewer deaths and less economic decline:

However, Adam Patinkin replies:

Neither of those things are true.

First, if you look at “all-cause” mortality, not just COVID, Sweden has negative all-cause mortality this year vs. Finland having positive all-cause mortality. More people have died this year in Finland than in a normal year and fewer have died in Sweden than in a normal year, full stop. Sweden has outperformed from a health perspective.

Second, there is a massive definitional issue. You literally cannot compare COVID deaths in Sweden to Finland. In Sweden, it’s marked as a COVID death if the person had COVID at any time within the 30 days [prior to their] death… regardless of the actual proximate cause (car accident, suicide, murder, etc.). In Finland, COVID deaths in nursing homes were not counted for a substantial portion of the crisis. In nursing homes! Now, Finland has gone back and added some of those, but it is pretty clear that Finland’s death count is substantially under what most other nations would count, and especially relative to Sweden.

Third, remember that Sweden had an extremely light flu season in 2019. There is a meaningful correlation between the severity of flu seasons in 2019 and the impact of COVID in 2020. Sweden was already fighting with one hand behind its back, and it still came out ahead of Finland in all-cause mortality.

Fourth, remember that Finland was one of the “lightest touch” lockdowns in the EU. It looks far more like Sweden than the U.K. So it locked down, but relative to the rest of the world it was a short and light lockdown.

Fifth, one area of key difference is that Finland closed its schools. That is a terrible strategy. One study showed that the school lockdown in Finland did not reduce infections vs. having no school lockdown in Sweden: It was a wasteful, bad policy choice.

Sixth, the economy. Sweden is a heavily export-dependent economy (Saab cars, forestry, etc.) whereas Finland has a much more stable, services-oriented economy. Sweden should have done far worse. I had my analyst pull H1 GDP, and he had Sweden at -3.5% in H1 2020 vs. Finland at -3.8% in H1 2020. Finland should have blown Sweden out of the water, but instead Sweden edged ahead. That is a massive win.

A better economy. Fewer deaths. Schools open full-time. Sweden crushed Finland… and Finland had only a moderate lockdown. If you compare Sweden to countries that locked down harder (and/or that remain locked down, even as the disease is effectively over in Sweden and life is mostly back to normal), it’s a total blow-out.

Thank you, Adam!

Sweden is doing so well that even the New York Times is writing about it: Vilified Early Over Lax Virus Strategy, Sweden Seems to Have Scourge Controlled.

Best regards,


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.

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