When we first start generating this chart on confirmed COVID-19 cases by country, we saw a trend developing. Progression of confirmed cases by day (with t+0 at 100 cases on a country-by-country basis), we saw that the rate of increasing cases (2nd derivatives) had an inflection point that is increasing between 15 and 20 days. That is, from the time a country crosses 100 cases, it took roughly 20 days to get the outbreak under control (new daily cases are less than the day before).
The chart for Italy, USA, Spain, Germany and France suggests otherwise as their inflection points have yet to be reaches and extended well past t+20 days.
China Ex-Hubei is the longest test case with an inflection point at 20 days. While there were 127 cases at t+0 (1st point) increasing rapidly to 11,287 cases by t+20, a further 20 days later (t+40) there were “just” 1,784 new cases. A similar inflection point occurred in South Korea at t+17, whereby the daily number of new cases started to fall.
What’s the reason?
Since our last publication things have become worse. Despite being in lockdown, Italy is still experiencing increases to t+31. This could somewhat be explained by the delay to lockdowns on March 9 (t+14) whereas China, South Korea and Singapore quickly implemented early lockdowns. Ostensibly, the experience in China and South Korea suggest this could take six weeks to pass through; but arguably this time period is conservative as Asian nations have generally been more compliant than European nations. More concerningly, other large nations such as the US, Spain and France appear to be on the Italy path which suggests more trouble ahead for those nations and more stringent lockdowns for greater parts of the global economy.
Consequently, it would be safe to assume that COVID 19 is likely to be with us for at least the next few months. If economic restrictions remain for the same amount of time, market conversations will rapidly move from health and liquidity crises to talk of a solvency crisis. The slowing of the Italian cases and the co-ordinated government action has provided some much-needed recent confidence.
Meanwhile, stay safe, and look after each other.
