0 11 min 11 mths


Authored by Peter Tchir via AcademySecurities.com,

Chalk & Cheese, Apples & Oranges, Omicron & Delta

When Brits compare two things that aren’t really the same, the rejoinder is “chalk and cheese.”

When Americans compare two things that aren’t really the same, the retort is “apples and oranges.”

It really is a disservice to compare two different things in an attempt to reach a conclusion.

Yet, we are at the stage of the pandemic when we are treating Coronavirus, Delta, and Omicron as all “just” Covid.

I think this is leading to some very incorrect conclusions and it is time to get better (a lot better) at how we look at the data.

Phase 1 – Coronavirus – Late 2019 until Late 2020

This was the initial phase. It started in China, spread to Italy and then to the U.S. and ravaged people. It was a living nightmare. But data from this time period should be tracked separately at this stage for many reasons:

  • Nursing homes were being particularly hard hit. In most states, well over 50% of the deaths were occurring in nursing homes. Some states were reporting that information, but many weren’t. Whether they didn’t have the data, felt strange releasing the data, or were covering up the data to hide what turned out to be bad decisions early on, isn’t the point. The point is that we didn’t have the data and many of the initial responses were not as targeted as well as they could have been. We have done a much better job identifying and understanding at risk groups/settings and we should not see a repeat.

  • No vaccines. Self-explanatory.

  • Limited Testing. You had to be pretty obviously sick to get tested, skewing the results as there was no good information on who was infected and didn’t get tested because symptoms were minimal, or they were more scared to get tested than face it at home.

  • No treatments. There were no treatments or therapeutics, at least none that weren’t mired in controversy of some form or another. The standard procedure was to use ventilators, which proved ineffective and maybe even harmful in the absence of other treatments.

Bottom line, the deaths, which were tragic, would almost certainly not occur now, given all that we know and have at our disposal in the battle against the pandemic. In no way do I diminish the tragic loss of life, but talking about the initial loss of life (under very different conditions) isn’t as helpful in determining policy today as it was a year ago and I’d actually argue it is detrimental to solving for the future.

Phase 2 – COVID & Delta – Late 2020 until Late 2021

Coronavirus was replaced with the term COVID-19, and has since been labelled, by most, as COVID. The Coronavirus label was deemed too generic as there are all sorts of Coronaviruses that aren’t as lethal as the original strain of COVID (though even in Phase 1 there were identifiable and distinct strains).

  • Vaccines. Vaccines became widely available and were generally distributed on a need/risk basis (though different states and countries had their own battles with supply). I won’t go into the politicization of vaccines because I can’t think about how to write about that without offending many people, but it is an issue that affects vaccine usage to this day.

  • Therapeutics. There has been a lot of advancement on therapeutics and treatments. Monoclonal antibodies seem to be effective and a part of the future fight. Lots of reasons to be optimistic.

  • Delta. The first ‘variant’ that attracted a lot of attention in its own right, and probably a very good place to start separating the phase 1 data from the phase 2 data.

  • Ample testing. It was possible to get tested quite easily and stores had stacks of home testing kits available. We probably got some of the more accurate data about actual infections during this period because of the widespread availability of testing.

  • Boosters. I really don’t remember talk about needing semi-annual or even quarterly boosters. In fact, writing about the vaccine becoming like the flu shot, with an annual update, received far more pushback than agreement. This is not political, but does highlight how the “science” is evolving.

Phase 2 data is useful, because we had our first real test of better protection and treatment with a new and deadly variant.

Phase 3 – Omicron – Late 2021 until…

Omicron is a new variant. It is described by scientists as having a large number of mutations.

The “new” variant now makes up as much as 75% of the new cases being reported in the U.S.

  • That number is difficult to confirm because not every test is “sequenced.”

  • That number might be low because testing availability has become non-existent.

  • That number might be low because it seems like so many people are asymptomatic

“Breakthrough” cases have gone from being uncommon under Delta to almost the norm. I see at least 5 famous people (if you include Senators and members of Congress) who have tweeted in the past few hours that they are positive despite being fully vaxxed and having received boosters.

  • A lot of people, such as the 5 above, are saying their symptoms are mild because of the vaccinations.

  • There are a lot of people who are claiming the symptoms have been mild who have not received their booster.

  • There are a lot of people who are claiming the symptoms are mild, who had no vaccinations.

  • Other countries are showing some data that supports the view that this is highly infectious but not as dangerous.

  • Maybe, just maybe, Omicron isn’t that lethal? Maybe, just maybe, as viruses are apt to do, it mutated to a version that is more transmissible without killing its host? With so many mutations, shouldn’t we treat the data on Omicron separately?

Data by Phase

In no way do I want to suppress any data, but lumping it altogether makes no sense, especially if Omicron is that different.

Telling us what percentage of people in hospitals as of last week were vaccinated or unvaccinated does very little good if those were all based on Delta because Omicron is now the one causing the case counts.

Yes, if Omicron is 10x more transmissible (to pick a number) than Delta, and has the same percentage of people requiring hospitalization, hospitals could be overrun.

But that is not what is coming out in the data so far (brings back memories of the Javits Center being turned into a makeshift hospital and the Navy Hospital Ship in New York, both of which thankfully turned out to be unnecessary).

The data that I would like to see (and what I am striving to tease out of existing data):

Why I want to see the data this way:

  • I’m not particularly concerned at this stage with what occurred prior to widespread vaccination. Older data is going to make the data less helpful rather than more helpful (we are all aware of how bad it got before we were doing much to combat it)

  • We need the breakout by vaccination and by what strain. That data will be somewhat difficult as we aren’t sequencing enough, but should be done as best as possible. I’d expect that Omicron barely existed before December 1st, but would be the most cases since then.

  • We can track if patient response by vaccination has changed recently (even for Delta and other strains) and can see how Omicron is affecting people in real time.

Bottom Line

I think that comparing Delta to Omicron is as nonsensical to comparing chalk and cheese or apples and oranges. On the basis of what data I can delve into, I think that the Omicron fear sell-off is over.

Politicians might do something to stop that but given how many people seem to be trying to come up with information as detailed as the above (and are coming up with comfortable results), the political backlash is likely going to be strong, so it won’t occur (at least in the U.S.)

The initial results of Omicron might deteriorate in the coming days. If the thesis that Omicron is much milder for all types of vaccination statuses turns out to be incorrect, then this gets ugly quickly, but the data seems much better in the details than in the media soundbites.

I will stick to my quality/value versus FOMO/TINA outperformance view expressed in Sunday’s T-Report and think that the market has more hurdles to cross, but that seems more likely to be a next year event as the Omicron hedges get taken off into an illiquid market.

Good luck and keep watching the Omicron data and hopefully that data continues to be as comforting as it currently has been on severity.

None of this is medical advice, nor is it based on soundbites, it is the best I can get out of digging into the existing data. I do wish that we would get data that is better suited for analysis than what is currently presented.

On a truly bright note, that no one can disagree with (I hope) the days start getting longer from here, at least in the Northern Hemisphere!


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