Second, it is not very helpful to have the Treasury and the Fed in open disagreement about this type of issue. This probably explains why markets reacted negatively.
There is a lag between cases & deaths, and as we see acceleration in cases, there is always a debate about whether fatalities will follow. That debate was there in the US second wave in the summer, in the European 2nd wave in recent weeks, & now again in the US 3rd wave
I will repeat a point I have made before. When I look at the momentum in COVID cases in Europe (proxy for Rt if you will) the most important thing to monitor now is whether 'lockdown lite' can work.
We know that full-blown lockdown will will work. But it is more interesting that the Netherlands, Germany and Denmark are getting case growth down notably by embarking on lockdown lite (shops remain open, restaurants are restricted (but not shut), mask mandate in public places)
The Netherlands has had negative (smoothed) case growth for 11 days. Denmark has had negative case growth for a few days. Germany is close to zero case growth (Rt=1) on the smoothed measure. But it growth actually turned negative on the non-smoothed daily metric, today.
The WSJ has a good overview of the record number of US COVID cases recorded in the latest daily data. They discuss the various factors contributing. But they do not mention weather/temperature. I think that is a mistake... @JenCalfas@bysarahkrouse
There is a big debate about the European 2nd wave, and whether it is serious or not. And it is surely hard to look at cases alone, since the testing quantity is totally different. I think looking at the dynamic CFRs is very informative....
= mini-THREAD
The table here shows Case Fatality Rates over time for several European countries, using recent deaths vs lagged cases.
It shows that you cannot really talk about severity in a uniform sense.
Some countries, such as France, Finland, Sweden, Norway an Denmark have stable an very low fatality rates (<1%) even with cases ticking up.