How will Covid-19/Coronavirus Affect my Alternative Investment Portfolio? Part 51: February 27th
Progress on third death wave ominously stalls out and reverses; Crystal ball: Progress on third U.S. infection wave also stalls out at problematically high levels; World round-up: U.K. and Spain’s strict lockdowns continue to beat back mutated strains but several other European countries appears to be losing control once again; State Roundup: Postponed this week; “What else is new?” Yet another week brings more brutal levels of new unemployment; Financial Cliff: "Large Stimulus" party passes $1.9 trillion pandemic-aid bill in the House as all eyes move to Senate; Foreclosure moratorium extended from March 31st to June 30th; Mutant Watch (Part 1): Scientists believe quick spreading California variant is indeed more contagious while Fauci warns its fight for dominance with U.K. variant could provoke even more problematic mutations; Mutation Watch (Part 2): Scientists accidentally discover New York City variant that’s highly likely to be more contagious and resist vaccines; Mutant Watch (Part 3): Is there a vicious new U.S. variant flying under the radar in the mid-Atlantic states? Accidental discovery in a strangely sick baby sets off potential alarm bells.; Mutant Watch Part 4: Odd, multi-country surge in child infections, causes some to speculate that children may be more susceptible to mutations than the original; Will vaccine resistors ruin the party for others? Early signs in U.S. Military and in Israel aren't promising; FDA panel approves Johnson & Johnson vaccine paving way for emergency authorization this weekend; Update on my portfolio strategy.
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This week there was a flood of new information on virus spread, economic impact, investment repercussions, the financial cliff and worrisome mutations.
This article is part of a multi-article series that's been published weekly since the pandemic began, back in March 2020. After this week the series is moving from weekly to a bi-weekly schedule. So the next update will be in 2 weeks (rather than 1) It started with three introductory articles on the virus and its effect on the economy and on alternative investment classes. Then it moved on to weekly updates on the latest and greatest developments (along with weekly updates on my evolving personal portfolio strategy). You can see the links to every article in the series here.
Progress on third death wave ominously stalls out and reverses
For the 57th week in a row, the United States battled the coronavirus called SARS-CoV-2, which causes the Covid-19 disease. And as of Saturday morning, the official death toll had climbed to 523,092 (versus 496,063 2 weeks ago on Saturday morning). On Monday, the country passed the grim milestone of more than half a million Americans killed. And that evening, the White House held a moment of silence for the deceased. At sundown, 500 candles were lit (each representing 10,000 killed) and the Marine Corps band played "Amazing grace." Most health experts agree that the actual death toll is almost certainly much larger than the official statistic (due to the chronic shortages of adequate testing through much of the pandemic). Here's a quick summary of what's happened so far:
The first U.S. death wave started in early March 2020. It spread overwhelmingly in urban areas (like New York City in the Northeast). It peaked on April 21st and the country fought it down until July 6th.
The second death wave started on July 7th 2020. This ran predominantly through urban areas in the Sun Belt. It peaked on August 1st, before falling until October 8th 2020.
Then the third death wave began on October 9th 2020 and unlike earlier waves, was led by rural areas. Later though, it spread across the entire country and surged in all areas, which made it more difficult to contain and fight than earlier waves. In late October 2020, this caused acute shortages of critical drugs and key medical personnel needed to fight the disease and limit deaths. Then in November, it caused hospitals to overload in certain areas of the country. When overload happens, hospitals are forced to deny care to incoming patients (both those infected with the virus and uninfected). And not only do more people die of Covid-19 unnecessarily, but others (via heart attacks and other completely unrelated problems) die unnecessarily, too. This wave peaked in late January of 2021 and began to subside in mid-February 2021.
How did things go this week?
This is an unwelcome graph, as new deaths moved in the wrong direction, worsening at the end of the week. Still, one week is too short of a time-frame to know if this is a new trend (i.e. the end of progress on the third wave) or just a blip. So, we'll continue to watch and see. As discussed previously, many states took advantage of the positive news (falling deaths) to loosen health restrictions (including mandatory mask mandates, lockdowns, etc.) in response to complaints from weary and/or outraged businesses and citizens. However, many health experts and officials have warned that new, more contagious, mutated strains of the virus are poised to slam down on the country like "a big wall." And, if these predictions come true, then premature guard-lowering may launch and propel a 4th wave even higher.
This week, more of those warnings were issued. CDC director Rochelle Walensky said:
“Things are tenuous -- now is not the time to relax restrictions. The latest data suggest that these declines may be stalling, potentially leveling off at still a very high number. We at the CDC consider this a very concerning shift in the trajectory.”
And to lockdown-weary citizens, she added:
“We may be done with the virus, but clearly the virus is not done with us.”
Walensky said the U.K. variant (which overran that country in January 2021 and is called B.1.1.7) now makes up 10% of U.S. cases. And it is still believed to be on track to become the dominant strain in March. Additionally, this week, scientists found evidence that the homegrown California strain is more contagious and causes a two times higher viral load. And others found evidence of two new strains that appear problematic: New York and Mid-Atlantic. And more experts voiced concern about the “nightmare scenario”: multiple strains infect a single person and mutate to spawn an even more powerful strain. More information on these details and more are in the "mutation watch" section below.
Crystal ball: Progress on third U.S. infection wave also stalls out at problematically high levels
If we're unable to make clear progress and deaths remain high, then the overwhelming consensus of economists is that this would sabotage hopes of a quick, V-shaped recovery. Instead, the recovery would assume a different shape (W-shaped, U-shaped, etc.). This would be slower, involve more long-term damage to both health and economy, and potentially cause problems for some or many consumers, businesses and investments. (See part 14 for more information on the possible "recovery shapes" and their ramifications).
Since this is potentially so important, let's take a look at one of the leading indicators of upcoming deaths: virus infections. Virus infections tend to lead deaths by anywhere from 2 to 8 weeks (depending on how long it takes someone to die and how long it takes their particular location to report the information). These case numbers are not completely reliable due to testing labs' difficulties, in many parts of the country, with getting results back on time. And some states are not reporting all of the positive tests (specifically, the antigen tests). But they can still provide a clue of what might lie ahead with deaths.
How did virus infections look this week?
This is a potentially alarming graph. After five weeks of progress fighting on the fifth wave, progress clearly stalled this week and plateaued. And the virus continued to spread at extremely high levels (far in excess of even the worst of the second wave).
Dr Anthony Fauci, the head of the National Institute of Allergy and Infectious Diseases, said:
“We really have to be careful and take a look at that curve. If we plateau at 70,000, we are at that very precarious position that we were right before the fall surge, where anything that could perturb that could give us another surge.”
A high level of viral spread also is an economic concern. That's because many economists believe that a broad, sustainable economic recovery cannot begin until viral spread is controlled and brought down to a low level.
World round-up: U.K. and Spain’s strict lockdowns continue to beat back mutated strains but several other European countries appears to be losing control once again
How did other countries do this week? As we discussed in part six, South Korea uses an aggressive mixture of the Three T's of epidemic control (testing, tracing and treatment). And through most of the epidemic, it has been one of the world leaders in both minimizing deaths (one of the lowest per million) and also minimizing economic damage (their economy is now mostly open and growth is projected to barely shrink this year, while in comparison, the U.S. still has significant closures and is projected to take a -3.5% hit to GDP).
However, in late 2020, South Korea experienced a third death wave that was more difficult to control. And while this wave is minuscule compared to other countries’, South Korean officials were still very concerned and have announced stricter lockdowns. Then in early 2021 the country also discovered the presence of the new mutated strain of the virus (which spreads more quickly and is more difficult to contain). How are things going now? This week, South Korea looked like this:
This was a mediocre week for South Korea. Deaths dropped and then rose to end up higher than they started. Still, it's too early to say that progress has stopped or the trend has changed from just one week. So we'll continue to monitor them.
Meanwhile, how’s Sweden doing? We used to look at Sweden’s stats in depth every week, because it was following an unorthodox lockdown-lite strategy. And the hope was that it might prove itself as a successful alternate model for other countries to follow. But after a recent surge of infections, hospitalizations and deaths, they’ve reversed course and their strategy is becoming much more similar to others. And so far, lockdown-lite has resulted in worse economic damage and a stratospheric death toll (versus the top countries). So we switched to a two-month schedule, and will look at them in detail in six more weeks.
Meanwhile, the other nations in Europe were hit by a brutal second wave of deaths starting in August 2020. After enacting a variety of new lockdowns many started to get it under control by December 2020. But then new, mutant strains hit in January 2021 which are much more contagious than the original version, and more difficult to stop. As hospitals overloaded, this forced many of them to enact economically crippling, full lockdowns. then in early February 2021 these finally began to take effect and improve things.
So how did things go this week? First, let’s look at Portugal and Spain. Both are popular travel destinations and were among the first to get hit by the second wave:
These are encouraging graphs. Both countries continued to push down deaths this week and are currently in control of their second death wave.
Meanwhile, the U.K. has been hit hardest by the new, faster-spreading U.K. variant B.1.1.7 (See “Mutant Watch” below for more info). And to prevent hospitals from overloading, it’s had to implement some of the strictest lockdowns and travel restrictions on the continent. But this week brought some more good news, as deaths continued to drop.
So the lockdowns are working, but continue to be held in place for now (which exacts an economic toll).
Additionally, France, Netherlands and Belgium also saw welcome drops. The one unhappy exception this month was Italy, where new deaths plateaued worryingly. We will watch how these do next week.
However, European officials aren’t celebrating yet, but instead are bracing themselves for more trouble. And that’s because infections have stopped dropping in multiple countries and are now ominously rising.
This increase in infections has caused some countries to return to implementing tougher restrictions. For example, French Prime Minister Jean Castex said that Paris is one of 20 regions in the country that is potentially facing increasing lockdowns. And the government hopes to lock down limited areas and regions to avoid a bruising, nationwide lockdown (which has happened twice already). Castex said:
“A lockdown is a tool that we have to resort to when we can’t do anything else. We must do everything to put it off and allow the vaccines time to have an effect.”
However, the French government has been heavily criticized for its vaccine rollout. As of Tuesday, only 2.6 million French citizens had received merely a single dose of vaccine (and only 1.3 million fully vaccinated with two doses). This was a considerable improvement over the early weeks of the rollout when only a few hundred received the injection. But it still ranks very poorly compared to the majority of other first world countries.
State Roundup: Postponed this week
For the last several months, we've watched individual U.S. states to get insights on what might happen next at the national level. And if a fourth wave does indeed hit, then this will continue to be useful. However, since it's not yet 100% clear that this inflection point has occurred, we’re skipping the state level examination this week.
“What else is new?” Yet another week brings more brutal levels of new unemployment.
Unemployment has historically been one of the most reliable indicators of when the U.S. has entered a recession and when its left one. So that's why we examine it very closely, every week.
And unfortunately, over the last 49 weeks, the economy has been hammered week after week by massive levels of new unemployment. Two weeks ago, new unemployment moved in the wrong direction and hit a four week high at 861,000. This was an increase from the 793,000 newly unemployed the week prior. Then this week, new jobless claims dropped a bit to 730,000.
So at this stage, we’re 12 months into the pandemic, and still getting weekly job losses that are more than three times the pre-pandemic level (216,000 in February of 2020). Back then, few imagined the continuing damage would ever last this long.
On Tuesday, Federal Reserve Chairman Jerome Powell said:
The path of the economy continues to depend significantly on the course of the virus and the measures undertaken to control its spread. The resurgence in COVID-19 cases, hospitalizations, and deaths in recent months is causing great hardship for millions of Americans and is weighing on economic activity and job creation. Following a sharp rebound in economic activity last summer, momentum slowed substantially, with the weakness concentrated in the sectors most adversely affected by the resurgence of the virus. In recent weeks, the number of new cases and hospitalizations has been falling, and ongoing vaccinations offer hope for a return to more normal conditions later this year. However, the economic recovery remains uneven and far from complete, and the path ahead is highly uncertain.”
Financial Cliff: "Large Stimulus" party passes $1.9 trillion pandemic-aid bill in the House as all eyes move to Senate
As we've discussed over the last several months, there's a huge but invisible problem with the economy, that's largely unrecognized by the general public. But an overwhelming consensus of economists, analysts (across the political spectrum) and policymakers at the highest levels (including the Federal Reserve) all agree that it's essential we find a solution to it. And if we don't, millions of Americans and businesses are destined to fall over a financial cliff with devastating long-term consequences. If this happens, then we may suffer a debilitating double dip recession (the dreaded "w-shaped recovery"). And investors in many alternative investment asset classes (including certain real estate sectors) could be caught up in a world of hurt. This financial cliff is caused by several things:
Impending collapse of crucial safety nets: This spring, 10-12 million people who lost jobs due to the crisis are scheduled to lose critical benefits they're currently depending on. These were provided by two government programs (the CARES Act in mid-2020 and extended by the second stimulus passed at the end of 2020). The first safety net is the Pandemic Emergency Unemployment Compensation (PEUC), which gives workers, who've been unemployed so long that they've exhausted state unemployment benefits, an additional 24-week lifeline. The second is the Pandemic Unemployment Assistance (PUA) for workers in the gig economy who are otherwise unable to get the same benefits that traditional workers receive when they lose their jobs. Both of these programs expire on March 14, 2021. If that happens and these workers don't get any additional help, then the damage to the economy would be severe, immediate, and potentially long-lasting.
Foreclosure and rental eviction tsunami: on June 30th 2021, moratoriums on evictions and foreclosures are scheduled to expire. If this happens, then a tidal wave of 8 million delinquent homeowners are set to be foreclosed on and lose their homes (dwarfing the worst of the Great Recession). And 12 million more delinquent renters (owing an estimated $70 billion in back rent as of 1/23/2021 and $25 billion more in utilities as of 12/2020) will be evicted, as well. If the tsunami is allowed to occur, then it will have a devastating effect on real estate and the wider economy. The December 2020 stimulus act allocated $25 billion in rental assistance towards this and was a step in the right direction. But analysts said it’s “not enough to avoid eviction crisis”.
Hard-hit restaurants and bars left out in the cold: for reasons we've discussed in past weeks, neither of the two previous pandemic aid laws were effectively able to help out restaurants and bars. Some analysts calculate that, if unaddressed, this will "leave millions more out of work."
Not enough funding for crucial transit industry: the December 2020 stimulus act allocated $14 billion to help but this is less than half of what the transit industry needs to avoid “devastating service cuts and layoffs”. And the loss of service could cause negative economic repercussions across the wider economy.
$600 Stimulus checks criticized for being insufficient for the unemployed.
No aid for U.S. states hammered by covid-19 bankruptcies and layoffs.
(Not as urgent.) In the past, there has also been another issue: Student loan payment resumption: The CARES Act suspended payments and interest on $1.7 trillion in student debt during the pandemic. And the Federal Reserve estimated this saved borrowers from paying about $7 billion a month. And originally this was set to expire in January. However, last week, it was extended to September 1st. So this was good news and makes it a much less urgent issue (and we are taking it off the list for now).
So, what actions are being taken to prevent the financial cliff, currently?
In late January the new President proposed a $1.9 trillion stimulus package, which included spending for all the above issues. But initially, this was panned by the opposing party (which we will call the "small stimulus party"). Despite this, the $1.9 trillion package was passed in the Senate. And that’s because the large stimulus party controls an effective majority on budget reconciliation items like this (with 50 out of 100 seats plus the Vice-president casting the tie-breaking vote). And then the bill was passed to the House, who put it on a 10-day fast-track process.
This week, the bill was presented to the House for a vote. It was named “The American Rescue Plan” and passed 219 to 212 on a largely party line vote.
Now, the two separate bills must return to the Senate for reconciliation. As mentioned earlier, this falls under a special process called budget reconciliation. And since no “small stimulus party” Senator will vote for it, the large stimulus party must get every one of its 50 members to agree. And even the loss of a single vote would scuttle the bill.
The House bill also contains a controversial provision to increase the national hourly minimum wage from $7.25 to $15 by 2025. The idea itself is very popular: a Pew Research poll found that two thirds of Americans back this idea.
But, on Thursday, a key Senate official ruled that minimum wage cannot be included in the bill, because it doesn't qualify as a budgetary issue. Thus, it would require the normal 60 vote majority to pass. And this is currently an insurmountable obstacle, with all small stimulus party members against it, as well as two large stimulus party members (Joe Manchin of West Virginia and Kyrsten Sinema of Arizona). So this means the provision will almost certainly be removed.
The goal of the large stimulus party is to pass the final law before the current unemployment benefits expire in mid-March. We’ll continue to monitor and see what happens.
Foreclosure moratorium extended from March 31st to June 30th
This week, the President announced he's extending the foreclosure moratorium on federally backed mortgages through June 30. And the period in which people can request mortgage forbearance was also extended to the same date. Previously, both programs had been set to expire at the end of March.
Mutant Watch (Part 1): Scientists believe quick spreading California variant is indeed more contagious while Fauci warns its fight for dominance with U.K. variant could provoke even more problematic mutations
As we've discussed, the pandemic entered a new phase in early 2021 with the emergence of several mutations of the original virus in different parts of the world.
The short-term concern is that these variants contain mutations to genes that make them much more contagious. And evidence is growing that they’re able to continue spreading even when confronted with the kinds of partial lockdowns that would’ve stopped the original. So, they may present countries with an unwelcome choice. Either send a “tsunami” of new patients into health systems (with many already overloaded and overstressed). Or enact full lockdowns like we saw in the early pandemic (which would be just as economically crippling).
And there are also medium to longer-term concerns. Some of the variants have been proven to re-infect people who recovered from the original disease. So they have the potential to start a second pandemic.
Other variants have been shown to render current vaccines less effective. And so these mutations will at least delay a fully effective vaccine rollout. And the longer it takes to fully control the virus, the more chance there is of breeding future mutations (which might be even more problematic).
And, it’s even possible that the virus could start mutating so quickly that it becomes like the common cold. If that occurs, then humans would have to play a constant cat-and-mouse game, creating yearly vaccines to battle it (similar to the flu shot). And such a scenario could have significant negative long-term consequences for individuals, the economy and certain types of investments.
Currently, there are four major variants that health experts are most concerned about. All sprung up completely separately in different areas of the world. But each area had done an exceptionally poor job of controlling the virus previously (UK, South Africa, Brazil and the U.S.):
U.K. variant (B.1.1.7): Studies show this mutation is 50 to 70% more contagious than the original strain. This week, health experts announced there is early but preliminary evidence that suggests this variant also has a 30% higher chance of killing its victims.
South African variant (B.1.351): Studies have shown this is 50% more contagious than the original. Early but preliminary studies also suggest it may have the unwelcome ability to re-infect people who recovered from the original, and may reduce the effectiveness of current vaccines "by a small but significant margin." More definitive human trials are underway.
Brazil variant (P.1.): This mutation is believed to be more contagious than the original strain (but poor data from Brazil makes quantifying the amount difficult). But it has definitively been documented as having the ability to reinfect people who recovered from the original.
California variant (L452R): Much less is known about this variant, because the U.S.’s variant tracking systems are not the most effective (ranked 43rd in the world). But just this week, two separate studies concluded it is most likely more contagious, more resistant to antibodies and perhaps even more deadly (see below). And this variant also contains key changes to the distinctive spike protein, which are believed to be cause this behavior. And, like the others, the California variant is quickly displacing the original version (skyrocketing from only 3.8% of cases in November to 25.2% in early January.)
However, the U.S. has had very limited ability to track the variants ( ranking 34th in the world in late January of 2021) because it didn’t invest in the infrastructure and coordination necessary to do so effectively. As of late January, the CDC’s surveillance system could test only about 750 samples per week. In contrast, the U.K. had analyzed 210,000 samples by early February . A few weeks ago, the new President announced a $200 million investment to ultimately increase testing to 25,000 samples per week. And this week, CDC Director Rochelle Walensky announced that the county has ramped up rapidly and is now analyzing about 14,000 coronavirus cases each week. https://www.bloomberg.com/news/articles/2021-02-22/u-s-exceeds-500-000-deaths-u-k-has-opening-plan-virus-update?sref=WRJrJ8H7
So that is expected to help. But in the meantime, the country still risks flying at least partially blind into what may be the next crucial stage of the pandemic.
So what happened this week? Here are the latest known stats on mutant spread from the CDC. Again, health experts warn these are likely to be significantly undercounted due to the U.S. challenges with variant tracking mentioned above:
Brazil variant had been detected in 5 U.S. states
South African variant had been detected in 15 US states
U.K. variant had been detected in 45 of 50 US states
In past weeks, we talked about how the California variant was suspected of being more contagious because of how aggressively it's spread. But, the connection had not been proven with direct studies. So many scientists have been hurriedly studying it, to try to find out. This week, two of these studies were released.
The first came on Monday from scientists at the University of Washington. It has not yet been peer-reviewed. If accurate, the study found that a mutation in L452R gives the variant an advantage in binding to the receptors in human cells. And they concluded that if the study assumptions were true, then this could:
"...lead to significantly increased infectivity of the L452R variants, warranting their close surveillance and in-depth functional studies."
Ominously, the authors also noted that the timing of the rise of this variant suggests the virus may be getting stronger as it battles against humanity’s success (in containing it and gaining immunity from previous infection or vaccines).
“The positive selection for this mutation became particularly strong only recently, possibly reflecting viral adaptation to the containment measures or increasing population immunity.”
If so, then more and quicker changes could be in store.
Meanwhile, another study was also expected to be released late this week (and also not yet peer-reviewed). A large team of geneticists, epidemiologists, statisticians and other scientists conducted a wide-ranging analysis and was led by a professor of laboratory medicine and infectious diseases from the University of California at San Francisco School of Medicine named Charles Chiu. The team studied 324 people who were treated at UCSF hospitals and clinics. Ultimately, they found that a startling 69 were infected with the variant. Chiu said that California has been bracing for an invasion of the U.K. variant, but:
“The devil is already here, I wish it were different. But the science is the science.”
And according to Chiu, the team conclusion was that the variant is indeed more contagious. This ranged from 19 to 24% in some populations to a brutal 6x increase in infections for at-risk elderly people in a nursing home. Additionally, nasal viral loads of patients infected by the variant were twice as high as those afflicted by the original.
Additionally, the team concluded that the variant has a “moderate but significant resistance to antibodies generated by vaccines and previous coronavirus infection” (reducing their effectiveness by about 50%). In comparison, the South African variation has been found to reduce antibodies to 1/6th of normal levels. So on one hand, this was at least a relative improvement over that variation. But Chiu warned:
"It still is concerning. [And] I do anticipate over time it is going to have an effect on vaccination."
The team also created a genetically engineered version of the virus, which contained only the key L452R mutation, and exposed human lung tissue to it. While not necessarily exactly the same as the entire mutation, they found that this lab version was 3x more infectious than the original. Chiu said:
"This is consistent with what has been seen multiple times across the planet. The virus is not static but rather mutating as it circulates in the human species. And [it] gets better at infecting cells [when it] collides with natural and vaccine-induced immunity."
The study also noticed a higher risk of death among those patients (although the total number of deaths was small so this could have been just an aberration).
Chiu also voiced concern about the mixing of the U.K. and California variants in the same place. The potential problem is that each uses a different mutational strategy to defeat the body’s defenses. For example, the primary U.K. mutation is called E484K (or colloquially “EEK” for short). If that were to combine with the L452R modification in the California variant, this could lead to a “super-variant” with more resistance and contagiousness than either of the parent variants. Chiu said:
"The U.K. and California variants are each armed with enhanced capabilities. And the likelihood that they could circulate in the same population raises the specter of a return to spiking infections and deaths. [But] it also opens the door to the possibility that the two viruses will meet in a single person, swap their mutations and create an even more dangerous strain of the SARS-CoV-2 virus. This would be a nightmare scenario."
Dr. Anthony Fauci, the nation's top infectious disease expert, agreed this week that a head-to-head bout between the two variants wouldn’t be in humanity’s best interests:
"A survival-of-the-fittest contest between the U.K. and California variants could accelerate the spread of the strain that’s best able to elude the effects of COVID-19 vaccines.”
However, that is the experiment that’s happening right now in the state. And Fauci advised:
“The best way to prevent this is to stop the spread of either variant by getting vaccinated, wearing masks and limiting exposure to others.”
Mutation Watch (Part 2): Scientists accidentally discover New York City variant that’s highly likely to be more contagious and resist vaccines
This week, two different research groups published papers about a new variant that was discovered in New York City.
Columbia University posted their study on Thursday and it has not yet been peer-reviewed.
The researchers made their discovery by accident and had intended to simply scan New York City patients for the U.K., South African and Brazilian variants. So they created a test that could detect the common mutations that these variants all have developed to the virus’s spike protein. And then they ran the test on New York City samples. Unsurprisingly, they found a handful of these mutations (six U.K. variants, two Brazilian and one South African). But, they also found that a whopping 49 of the remaining cases fell within a previously unknown lineage. The new variant was named B.1.526.
The researchers noted that the New York variant shares the E484K mutation (which some clinically called the "EEK" mutation) with the U.K. variant. And this mutation has already been proven in laboratories to be resistant to the Regeneron monoclonal antibody treatment (rendering its effectiveness "either impaired or abolished"). The "EEK" mutation has also been found to lower vaccine effectiveness 3.4x. So the researchers concluded that most likely the New York City mutation shares similar characteristics.
And like the other variants, the New York City variant is rapidly becoming dominant over the original. The researchers noted that:
"[The variant] is surging, alarmingly, in our patient population ... to 12.3% in the past two weeks."
Meanwhile, early in the week, a Caltech study on New York City patients was also published. It has also not been peer-reviewed. But it found that almost one in four of the New York City genetic tests it examined contained the New York variant: B.1.526.
The Columbia researchers hoped that the variant might be occurring in only a couple of areas, to which it could easily be contained. Unfortunately, they found it "scattered throughout the metropolitan area" which means it is too widespread to confine.
Mutant Watch (Part 3): Is there a vicious new U.S. variant flying under the radar in the mid-Atlantic states? Accidental discovery in a strangely sick baby sets off potential alarm bells.
Meanwhile, potential alarm bells went off this week when scientists accidentally discovered a new U.S. variant in the mid-Atlantic states that could also be very problematic. It was triggered by a very sick baby at Children's National Hospital in D.C. The Chief of Infectious Disease for the hospital, Roberta DeBiasi, said this alone was unusual. That’s because the facility has treated over 2000 children and most barely even show symptoms. And those few who are hospitalized tend to have mild cases. So this alone was notable.
But when the PCR test results came back, the doctors were shocked. The infant's viral load was an almost unbelievably 51,418 times higher than the median of other pediatric patients. The results were so startling that they first believed it had to be a testing error. So they conducted a second test with a completely different provider. But there was no change and it came back with the same results. So the doctors wondered if a mutation could be the cause and sequenced the sample. And sure enough, they found it was a new lineage (now called N679S) And unsurprisingly, it had developed a mutation that involved the infamous spike protein.
Again due to poor tracking in the U.S., it's impossible to say for sure if this was a completely unique incident or a sign of things to come. DeBiasi said:
“It could be a complete coincidence. But the association is pretty strong. If you see a patient who has exponentially more virus and it’s a completely different variant, it is probably related.”
Researchers then took the results and scanned a genetic database to see if there might be any other patients with N679S. And they found eight others all in the U.S. mid-Atlantic region. They posted a study ( not yet peer-reviewed) which concluded that:
“The similarity of the regional sequences suggests transmission and persistence of the SARS CoV-2 variant within the Capitol region, raising the importance of increasing the frequency of SARS-CoV-2 genomic surveillance.”
Mutant Watch Part 4: Odd, multi-country surge in child infections, causes some to speculate that children may be more susceptible to mutations than the original
Meanwhile, an unusual pattern appears to be emerging in multiple countries, in which children are affected by the disease. The trend started a few weeks ago, when the U.K. said it had found an unusual surge in infections among children aged 6 to 9 (and disproportionate within the population). Currently, scientists are continuing to monitor the situation. Then in Italy, scientists said they found a surprising spike of COVID-19 infections in young children, when they closely examined the northern town of Corzano. In a study, they tested 1400 residents in the village and found 10% tested positive for the U.K. variant. But the real surprise is that 60% of the cases were kids from kindergarten and primary school. As a result, schools in the village were quickly closed this week.
Roberto Burioni, a professor of virology at San Raffaele Hospital in Milan, said:
“The much more contagious English variant calls for much greater precautions.”
Meanwhile, scientists published a February 9 paper in the medical journal BMJ, and noted that Israel is also experiencing some anomalous activity in its youth population. The paper says: