COVID-19: Breaking Down the “Second Wave”

By Charlie Bilello

25 Jun 2020


Talk of a “second wave” of COVID-19 in the US has begun.

Why?

Let’s take a closer look through a series of questions and answers…

What’s going on with new cases?

New daily cases in the US hit their highest level ever yesterday (38,672), surpassing the prior high from April 25 (36,006).

But I thought new cases were going down?

They were. A 7-day average of new cases peaked on April 10 at 31,014. This was when most of the country was in the midst of a shutdown.

From there, a slow downtrend would take hold over the next two months before daily cases hit a low of 20,065 on June 9 (7-day average).

Over the past 2 weeks, we’ve seen a re-acceleration higher with the 7-day average moving up to 30,912, highest since April 13.

Why are new cases rising again?

There are many competing theories here and no definitive answers given the lack of contact tracing.

It is extremely difficult to isolate any one cause given a myriad of factors that could have lead to increased cases in recent weeks. Memorial Day celebrations, mass gatherings (protests/political rallies), the reopening of states (particularly bars/restaurants), and a decline in social distancing practices are likely all playing some role here.

Are new cases rising everywhere?

No.

In the states that were hit the hardest, particularly in the Northeast (New York, New Jersey, Massachusetts, Pennsylvania), there has been no noticeable increase thus far.

Charts via YCharts

The same is true in the hardest hit states in the Midwest (Illinois, Michigan).

So where are new cases rising?

In the South (Texas, Florida, Georgia, North Carolina) and West (California, Arizona).

This is significant as it includes the 3 largest states in the US (California, Texas, and Florida), which represent over a quarter the country’s population.

Are the rising new cases in the South and West due solely to more testing?

Unfortunately, it doesn’t appear so. If new tests were the only reason for more cases we should see the % of positive tests stay flat or move down.

Instead, we are seeing just the opposite over the past 2 weeks.

Overall in the US, the percentage of positive cases has moved from 4.4% to 6.0% over the last 2 weeks.

Tests in the US over this time have moved from 450,637 per day to 520,869 (7-day average), a 16% increase.

If more cases were simply from more testing, we would see a similar % increase in new positive cases. Instead, we find a 54% increase over the same time period (20,125 to 30,912 per day).

In Florida over the past week, testing actually declined 12% while new positive cases increased 71%. It is hard to argue that rising cases there are not evidence of increased community spread.

Are rising cases leading to an increase in hospitalizations?

In the South and West, the answer is clearly yes, with new highs in hospitalizations in many states.

Overall US hospitalizations peaked on April 15 at 59,260 and trended lower over the next two months until hitting a low of 27,115 on June 15. Since then, we’ve seen a steady increase to the current level of 30,826, up 9% over the last week.

The recent move higher is a result of increases in hospitalizations in the South/West outpacing continued declines in the hardest hit states in the Northeast and Midwest.

Are rising cases leading to an increase in deaths?

Thus far, no. Deaths continue to trend lower, down to 566 per day over the last week. This is the lowest level since March 31.

Deaths are lagging indicator, though, and with hospitalizations just starting to rise, we would expect to see some increase over the next few weeks. Hopefully that doesn’t occur.

Will a new high in cases lead to a new high in deaths?

This is not likely at the current case levels for a few reasons.

First, cases hitting a new high do not mean that the virus itself is as prevalent across the US as it was in March.

Given the massive changes in social behavior since March, that is unlikely.

We are also testing many more people today (up 10x over the last 3 months) and certainly picking up many more cases with milder symptoms that have a lower probability of death.

That is to say – all cases are not equivalent.

The median age of those testing positive in Florida has gone from 65 in April to under 30 today.

As I discussed in my last covid post, there is a massive difference in fatality rates between younger and older populations.

We don’t have good data nationwide on the age distribution of new covid-19 cases over time, but if it is indeed trending younger, we should not expect to see an equivalent number of deaths.

That’s not to say there’s no risk to the virus spreading in younger populations (there clearly is and if it spreads widely enough it eventually will find it’s way into older populations), just that the outcomes for this virus are vastly different depending on who gets it (Singapore is perhaps the best example of this).

How long will this second wave continue?

Nobody knows for sure, but calling it a second wave is a little bit of a misnomer for two reasons: 1) we are not yet seeing a resurgence in the states that actually had a first wave, and 2) the states that are currently seeing sharp increases never really exited their first wave (ex: Texas and Florida started their reopening with new cases trending higher, and that trend has only continued).

Is a continued rise in COVID-19 inevitable with the reopening?

No. While an eradication of the virus may be unrealistic goal, containing it is not.

Many countries Europe and Asia have shown that reopening their economy does not have to lead to an uncontrollable outbreak that was worse than before.

I’m hopeful that the lessons learned from here and abroad will be applied to prevent an untenable situation that makes a continued reopening more difficult.

Even small changes (i.e. washing hands, wearing masks, avoiding large gatherings) can have big results. This will require discipline and some continued sacrifice, but the alternative (increased hospitalizations/deaths and a second shutdown) would be far worse. We all play a role in what happens next.

Related Post: COVID-19 Q&A

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About the author

Charlie Bilello

Charlie is the founder and CEO of Compound Capital Advisors.

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