The Index Investor Blog

The Deadly Race Between Vaccinations and COVID Infections from New Variants

With new highly transmissible SARS-CoV-2 variants now appearing in the US (including those first identified in the UK, South Africa, Brazil, and now one in Ohio) we are in a deadly race.

If we can exponentially increase the number of people vaccinated, we may be able to limit the exponential increase in the number of people who will otherwise suffer COVID inflection, and eventually overwhelm hospital capacity without severe lockdowns, as we now see in Europe.

Unfortunately, the evidence to date has shown that US vaccinations have been increasing at a slow rate. For example, between 20Dec and 15Jan, the percent of the US population that had been vaccinated increased from 0.17% to 3.71%. In Israel, it went from 0.07% to 25.34%.

While the Biden administration promises to speed up vaccinations in the US, based on the rates at which infections by the new variants have grown in the UK, EU, South Africa, and Brazil, it seems very likely (80% probability) that more severe lockdowns and economic losses lie ahead.

If this forecast turns out to be wrong, it will be because of a dramatic improvement in the US vaccination rate over the next month.