Coronavirus

[Oracle]

Can you explain the physics of this, Oracle?

That is the contradiction. I used a play on words

Banks are supposed to hold rock solid A grade investments as collateral, against a multiplier on savings and loans.

They also have to be liquid investments to allow them to fund withdrawals on request. It is in essence a contradiction.


Ask the italian banks, whose debt pile is propped up by dodgy italian government junk bonds. The banks have to keep buying more junk, to ensure there is a market in junk, so they can claim the junk bonds are saleable, and to push up the price so the collateral is maintained. It does not take the brain of britain to see something smells....

People point at banana curves as stupid EU laws: which EU usea distraction from the real stupidity of many laws, including in this caseallowing italian banks to prop up the house of cards on italian bonds. When we leave the EU, the UK banks will need more capital because they are no longer allowed to use this stupidity as a form of collateral!

One of the errors made by regulators was allowing mortgage bonds to be classed as A grade.

It is a house of cards.

[Oracle]

This week's More or Less on BBC R4 this morning had some interesting stats on the virus. It's worth a listen I kthink, regardless of your views on the BBC or on stats being capable of proving anything. If I understood some of it correctly your chance of dieing of this so far if you are a healthy adult between 15 and 65 is 1 in 19000. Also the number of deaths amongst health workers may not be statistically very much higher than the rate in the general population (accepting that if they ran out of PPE things would change). There's also some interesting stuff about death rate comparisons by country. Make if it what you will but I usually find this programme full of common sense and helps put things in context. They have some interesting things to say about the peak too - one argument is that it occurred a couple of weeks ago.

The issue of Medical staff being not much greater at risk has been evident in numbers for a long time. Although if you say it to our precious NHS and you will get a blast from them!

If I had to guess: I think it is because by the time infected patients need hospital treatment at 8 to 10 days, they may no longer be infectious. So much of the PPE might be wasted. The greater risk could be the other way round. Medical staff in NON COVID areas should wear PPE to avoid infecting other patients...

For background, there was a fascinating article in NY times by a physician saying that on most of the scans they are doing on Non Covid patients (eg for broken ribs etc) they are discovering some amount of COVID induced pneumonia in people who are wholly assymptomatic. Most of those tested! Fascinating.

Some response has been ridiculous. Sainsburies were putting 70 plus in the store at the same time as NHS workers! The most likely to infect, put with the most vulnerable!

[Mike T]

From today's Guardian - it is about Oz but the principles apply generally:

"This fear is due to the belief that the federal budget is like a household budget. If we borrow, we must pay it back, within the term of the loan, or our children will be paying it instead – or so the story goes.

The story is fiction. Public debt is not like household debt.

When someone takes out a mortgage to buy a home, they borrow against the value of that home – the property is the asset against which the loan is secured. The term of the loan is set so that the borrower can pay it off during their working life, while they maintain income sufficient to service the debt.


Australia will need to raise GST to pay coronavirus debt, tax expert says

When the federal government borrows, it also does so against an asset, which is the productive capacity of the Australian economy. Unlike a household mortgage, there is no time limit on repayment, because the national economy has no finite lifespan: Australia will never “retire”, it will continue to generate income through productive economic activity.

Therefore, the government can roll over its debt indefinitely, provided the nation’s economic activity continues. And as the nation’s economy grows, the size of the debt in proportion to national wealth, measured as gross domestic product, shrinks commensurately."

[Mike T]

Again, from the Guardian:

"Last week, something remarkable happened. The Bank of England let the cat out of the bag. In a paper called "Money Creation in the Modern Economy", co-authored by three economists from the Bank's Monetary Analysis Directorate, they stated outright that most common assumptions of how banking works are simply wrong, and that the kind of populist, heterodox positions more ordinarily associated with groups such as Occupy Wall Street are correct. In doing so, they have effectively thrown the entire theoretical basis for austerity out of the window.

To get a sense of how radical the Bank's new position is, consider the conventional view, which continues to be the basis of all respectable debate on public policy. People put their money in banks. Banks then lend that money out at interest – either to consumers, or to entrepreneurs willing to invest it in some profitable enterprise. True, the fractional reserve system does allow banks to lend out considerably more than they hold in reserve, and true, if savings don't suffice, private banks can seek to borrow more from the central bank.

The central bank can print as much money as it wishes. But it is also careful not to print too much. In fact, we are often told this is why independent central banks exist in the first place. If governments could print money themselves, they would surely put out too much of it, and the resulting inflation would throw the economy into chaos. Institutions such as the Bank of England or US Federal Reserve were created to carefully regulate the money supply to prevent inflation. This is why they are forbidden to directly fund the government, say, by buying treasury bonds, but instead fund private economic activity that the government merely taxes.

It's this understanding that allows us to continue to talk about money as if it were a limited resource like bauxite or petroleum, to say "there's just not enough money" to fund social programmes, to speak of the immorality of government debt or of public spending "crowding out" the private sector. What the Bank of England admitted this week is that none of this is really true. To quote from its own initial summary: "Rather than banks receiving deposits when households save and then lending them out, bank lending creates deposits" … "In normal times, the central bank does not fix the amount of money in circulation, nor is central bank money 'multiplied up' into more loans and deposits."

In other words, everything we know is not just wrong – it's backwards. When banks make loans, they create money. This is because money is really just an IOU. The role of the central bank is to preside over a legal order that effectively grants banks the exclusive right to create IOUs of a certain kind, ones that the government will recognise as legal tender by its willingness to accept them in payment of taxes. There's really no limit on how much banks could create, provided they can find someone willing to borrow it. They will never get caught short, for the simple reason that borrowers do not, generally speaking, take the cash and put it under their mattresses; ultimately, any money a bank loans out will just end up back in some bank again. So for the banking system as a whole, every loan just becomes another deposit. What's more, insofar as banks do need to acquire funds from the central bank, they can borrow as much as they like; all the latter really does is set the rate of interest, the cost of money, not its quantity. Since the beginning of the recession, the US and British central banks have reduced that cost to almost nothing. In fact, with "quantitative easing" they've been effectively pumping as much money as they can into the banks, without producing any inflationary effects.

What this means is that the real limit on the amount of money in circulation is not how much the central bank is willing to lend, but how much government, firms, and ordinary citizens, are willing to borrow. Government spending is the main driver in all this (and the paper does admit, if you read it carefully, that the central bank does fund the government after all). So there's no question of public spending "crowding out" private investment. It's exactly the opposite.

Why did the Bank of England suddenly admit all this? Well, one reason is because it's obviously true. The Bank's job is to actually run the system, and of late, the system has not been running especially well. It's possible that it decided that maintaining the fantasy-land version of economics that has proved so convenient to the rich is simply a luxury it can no longer afford.

But politically, this is taking an enormous risk. Just consider what might happen if mortgage holders realised the money the bank lent them is not, really, the life savings of some thrifty pensioner, but something the bank just whisked into existence through its possession of a magic wand which we, the public, handed over to it."

As to money obeying the laws of physics ..... it is a social construct, not a commodity or concrete entity.

[Mike T]

So we have now had our version of full lockdown for 30 days and of course we had some partial measures in place earlier.

We are still getting 4-6K confirmed cases a day.

I consider that my contacts with other members of the public have dropped to zero. Of course there are transfer contact issues (I touch an infected surface) and the question of whether 2m is enough.

But I have not been in breach of the guidance at all. Neither has my wife, and my 28 year old daughter has more or less camped in the house.

So where are all these new cases coming from?

Look at the timeline for Boris. It's about a 3-4 week cycle from catching, developing symptoms, those symptoms escalating to put you in hospital and then either your decline or recovery leading to being discharged.

So the level of infection being detected (how many are not detected) even with lockdown and the vast majority following rules suggests there are serious errors in the timeline of the development in us, and/or this is more easily transmitted than we had thought.

With such a spread during lockdown, it makes it more likely that it having arrived here in January, many, many people got this in the 10 weeks (quite likely longer) between it arriving and us moving to lockdown.

When you consider that in Italy they are approaching 50 days now, Spain are not far behind them, yet they are also still reporting new cases in the 1'000s per day.

Lockdown seems to have got us to a level of infection higher than pre lockdown. It doesn't add up.

I think the problem is that it is much easier to catch than people realise, and that asymptomatic and pre-symptomatic people can shed it for a long time. It is not just coughs and sneezes that spread it - it can be transferred just from exhaled breath. The 2 metre rule just lowers the chance of catching it, it is not a guarantee, particularly if you are downwind of an infected person. And it can survive on some surfaces for days. Think about in the supermarket - you are walking through invisible cloud after invisible cloud of people's exhaled breath; how many of the items you pick up have been breathed on or touched; how many people do get within 2 metres of you. Sure, the individual's chances of catching it are small, but every day millions of people are having to take the risk. And if they do catch it, all of their close contacts will as well.
And any change that is made - lockdown - takes weeks to be seen in the figures. I think it does add up.

[Mike T]

This week's More or Less on BBC R4 this morning had some interesting stats on the virus. It's worth a listen I kthink, regardless of your views on the BBC or on stats being capable of proving anything. If I understood some of it correctly your chance of dieing of this so far if you are a healthy adult between 15 and 65 is 1 in 19000. Also the number of deaths amongst health workers may not be statistically very much higher than the rate in the general population (accepting that if they ran out of PPE things would change). There's also some interesting stuff about death rate comparisons by country. Make if it what you will but I usually find this programme full of common sense and helps put things in context. They have some interesting things to say about the peak too - one argument is that it occurred a couple of weeks ago.

The death rate of those in their 60's is 3.5% or there abouts - hardly insignificant. And we have almost certainly had far more deaths than the official figures have stated up until now - the deaths in care homes, and those of people in their own homes of uncertain cause - there seems little doubt that many will turn out to be Covid related. One of the now classic presentations is "happy hypoxia" - people with severe pneumonia, a very low oxygen level, yet they are not at all breathless. Breathlessness of course brings you to medical attention - if you are not breathless, and do not present with for example collapse or confusion, you may simply die at home.
Let's hope we have passed the peak - new hospital cases do seem to be going down - and that a vaccine comes along soon.

[Oracle]

The death rate of those in their 60's is 3.5% or there abouts - hardly insignificant. And we have almost certainly had far more deaths than the official figures have stated up until now - the deaths in care homes, and those of people in their own homes of uncertain cause - there seems little doubt that many will turn out to be Covid related. One of the now classic presentations is "happy hypoxia" - people with severe pneumonia, a very low oxygen level, yet they are not at all breathless. Breathlessness of course brings you to medical attention - if you are not breathless, and do not present with for example collapse or confusion, you may simply die at home.
Let's hope we have passed the peak - new hospital cases do seem to be going down - and that a vaccine comes along soon.

Did you read the Nytimes article Mike? Most non covid cases that they scanned had assymptomatic covid pneumonia.

The problem with vaccines and antibody/antigen tests is validation. It is a lot slower process than people hope. It is not an instant solution. The press no doubt will keep asking stupid questions..

Granted care homes are a problem.

[Graham Breeze]

This week's More or Less on BBC R4 this morning had some interesting stats on the virus. It's worth a listen I kthink, regardless of your views on the BBC or on stats being capable of proving anything. If I understood some of it correctly your chance of dieing of this so far if you are a healthy adult between 15 and 65 is 1 in 19000. Also the number of deaths amongst health workers may not be statistically very much higher than the rate in the general population (accepting that if they ran out of PPE things would change). There's also some interesting stuff about death rate comparisons by country. Make if it what you will but I usually find this programme full of common sense and helps put things in context. They have some interesting things to say about the peak too - one argument is that it occurred a couple of weeks ago.

Excellent Programme - it has the benefit of presenters who understand what they are talking about and who assume their audience has an IQ of at least double figures.

In contrast with the BBC TV News which is a platform for pompous, preening, personalities presenting political propoganda and incapable of presenting meaningful data; but content to trot out "concerned", bland and broad "sound bite" generalisations so as not to upset viewers.

[Mike T]

Did you read the Nytimes article Mike? Most non covid cases that they scanned had assymptomatic covid pneumonia.

The problem with vaccines and antibody/antigen tests is validation. It is a lot slower process than people hope. It is not an instant solution. The press no doubt will keep asking stupid questions..

Granted care homes are a problem.

I could not access what I think is the article you are referring to - but I am not surprised they are finding Covid pneumonia in people who initially seemed to have something else altogether. Someone with a broken leg for example - why did they fall? Because they have a low blood oxygen level and the balance centre in their brain no longer works well enough. Or someone presents with confusion/drowsiness - again because their oxygen level is low. Both these hypothetical patients could have Covid as their initial problem, and the problem that may kill them.

[Witton Park]

I think the problem is that it is much easier to catch than people realise

But that's what I'm alluding to.

So how many caught it in Jan-March and yet we have no record or knowledge of them?

Maybe 25% of the population have been exposed to it already?

and so lockdown could be a complete red herring.