We are going to start today by going over the rationale behind opening up, as the topic appears to be generating a lot of attention on social media. From there, we’ll move to news and then to numbers.

Flattened Curves & Opening Up

On March 24th we went over the primary rationale (see “Why is this a big deal?”) for why we want to flatten the curve:

The hospitals [could get] completely overrunAs they get overrun, doctors, nurses and other healthcare workers in the highest demand ever start to get sick, and some die. Possibly while cases are still increasing as a whole. So the demand on the system is past its capacity and its capacity starts to shrink in response.

We can run the same scenarios for ventilators and oxygen machines but it amounts to the same thing. Our healthcare system isn’t built to handle a once in a hundred years pandemic.

[…]

This also is at the heart of “flatten the curve,” the entire idea is to keep cases within the capacity of the system. Plus, the math of exponential growth is that the faster you cut off exponential growth the less pain you have to go through.

This is critical to understand the arguments for opening up: the point of lockdown was never to stop COVID-19 growth. Without effective treatment or a vaccine that isn’t possible. The idea was to “flatten the curve” and keep case capacity within the limits of the healthcare system.

Under “flattened” scenarios a lot of people still become infected, but fewer people die. The time we are dealing with COVID-19 is actually increased in the “flatten the curve” scenarios because we purposely spread the cases out over time (the flattening) instead of spiking them all at once.

Therefore, in places that have demonstrated that:

  1. The curve is flattened
  2. They have healthcare system capacity
  3. Opening up is not likely to significantly reduce healthcare system capacity

Opening back up becomes the natural conclusion: it was the implicit promise of shutting down, “we’ll open up again when we can.”

If a geography or government can’t demonstrate all three of those things then opening up is a very difficult argument to make. If any of those items flip, then moving to more restrictive measures again would make sense.

Opening up still has risks and opening up is still not business as usual. It’s weeks or months of masks in public, restaurants at half capacity, large gatherings limited and months or years of social distancing in some form.

Opening up also doesn’t mean that people will actually go out. As one business owner noted:

The government can make people stay in, it can’t make people go out.

We will be living with COVID-19, in all likelihood, for some time. The phased re-openings are the part where we learn how to live with it.

To be fair, we’ll leave you with this: not everyone is for opening up, and we surely could be wrong.

News

China is reporting, in retrospect, an increase of deaths in Wuhan by 50%. We mentioned that this was possible a couple of weeks ago. Our main take-away is the same: Our view, is that for Western countries there is enough reliable data to come to our own estimates. For the developing world, however, this is bad news. (Also from that same post, some reports thought that the Wuhan death toll was closer to 5,000, these revised numbers only meet halfway.)

Good Morning Jonathan,

You all have a SBA approval number. This secures your funds. We are awaiting for the back office to prepare your documents. I will receive an e-mail when that occurs. We do currently have a back log that our back office is working on.

[First Horizon Bank Representative]

This is some of the best news we have been waiting on at JM Addington. For most businesses an approved PPP loan means that you will get your funds, eventually. If you did not get approval already you will most likely have to wait for Congress to appropriate more funds.

If you aren’t sure, contact your banker and ask. Even if you didn’t get approved in time the first round, start work today with your banker or accountant to have your financials ready for the next round. Reach out to us if you need to be pointed in the right direction, preparing the documents takes longer than filling out the SBA application.

We filled out three different versions and had late nights to get it done. It was worth it.

Knox County is furloughing employees, for eight weeks right now. It’s worth watching Mayor Jacob’s announcement for the first five minutes or so.

One of our repeated themes for the last month has been to watch the areas that are ahead in cases to see how they handle to see how other areas are likely to handle it. For the first few weeks that meant Tennessee was watching other states. Now, other states can be watching Tennessee.

You can expect to see a lot of this occurring at state, county and city levels going forward. A lot of fiscal years for municipalities are July-June, so you can expect to see both a greater impact and more clarity on this across the county in a couple of months.

Over half of LA County residents are now without jobs, significantly worse than other parts of the country. So what? COVID-19 won’t affect all places, or people, equally.

At today’s Knox County Health Department Briefing a new drive through testing site in Knox County offering free tests was announced at the Knox County Engineering and Public Works building. M-F, 8-3 (directions on Google Maps). KCHD is expecting a high volume of people to come through the first couple of days.

The other most interesting Knox County things from the briefing:

  • KCHD  is currently testing about 60 people/day
  • Ms. Menefee, the director of Communicable and Environmental Disease and Emergency Preparedness, graded Knox County’s testing a “C” overall
  • She also said that Knox County was, “still on the front half of that marathon”
  • Knox County contact tracing is only showing four to give contacts per case, “that’s a really low number. We do contact tracing all the time with different diseases.”(A contact does not necessarily mean a new case)

Nationally, the new cases curve trends down:

Source: Data from The COVID Tracking Project; Chart by JM Addington

Tennessee remains mostly flat for the last week:

Source: Data from The COVID Tracking Project; Chart by JM Addington

The nine-county area also shows about the same growth. Int he past we’ve shown 21 days worth of days, today we are going to expand that to 45.

Source: Data from the New York Times; Chart by JM Addington

Knox County is up 3 cases, today.

Source: Knox County Department of Health

Finally, we haven’t looked at Italy in awhile. The good news is, both new case and deaths continue to decrease from their peak.

Source: Worldometers

Source: Worldometers

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