It’s been about 10 days since the nation wide protests over a gruesome death (May 29, 2020). Originally, I predicted another lock-down in August. However, how with how large the protests are and how quickly states are open… <insert shaking head>. It’s quite possible we see a massive increase in cases much sooner. Probably around two to three weeks we will see a doubling of cases.
Here’s an example from New York, where it’s clear (I suspect Easter) we see a massive spike in cases, followed by a massive spike in deaths each followed by two weeks.
This implies that the idea that (a) it’s possible to reduce transmission(s) an also that spikes in deaths are following spikes in cases (i.e. the data makes sense).
There’s also states such as California, which appear to have reopened but are really having no reduction in cases at all —
I have a sneaking suspicion that California opened due to economic concerns as opposed to health. California looks like it is only getting worse. Finally,we have states such as Texas and Florida which seem to have their cases increasing after the reopen (and before the riots):
Given the increasing cases, it’s quite possible restrictions start back up again. While it may still appear “too late” in a couple weeks, I suspect 4-8 week lockdowns to start back up again mid-summer, and / or millions of deaths. Either deaths or lockdowns will create panic and spending will decrease and businesses will go bankrupt.
Combined with consumer fear, economically we have a:
- Financial system nearing the brink
- Massive Unemployment 15-20%, with PPP loans are starting to come to a close
- Bankruptcies: Cinemas, Oil Companies, Gyms, Airlines, Rental Car companies, Automakers, Retail (more on the way!)
- The Fed creating massive bubbles, difficult to control
- Riots on the streets (typically not a good sign, if it devolves)
- States nearing bankruptcies
- Retail investors have WAY overvalued companies and it’s about time for that shoe to drop.
- etc., etc.
My current prediction is that volatility will increase substantially, probably really taking hold by June 15 – June 20. By June 26 it’ll be obvious that lockdowns are necessary and by July 5th we’ll start seeing the majority of the nation locked down again. Q2 earnings are in late July, by then it’s quite possible we’ll test this years lows on the stock market.
Finally, all of the code to generate the graphs can be found on my github.