The most vicious campaign ad yet

Democrats said ‘believe all women’ when it was about accusing republicans, not so much when the accusation is against Joe Biden.

The Trump team has picked up on the double standard.

Wow. Just… wow.

Twiggy and Karl … grab a bucket

Last week The Breakdown slammed Twiggy Forrest for being a spineless brown-nosed bear to China, putting his commercial interests before the national interest.

If you can stomach it, watch this interview he did with Karl Stefanovic.

Twiggy is even more insipid than first assumed.

And one more thing – this is not what we do in Australia. this is blackmail.

The Pope is a dope (and he doesn’t understand economics)

Read this from Pope Francis about COVID-19 vaccines. There are at least two major problems in it – can you find both?

“It is important to unite scientific capabilities, in a transparent and impartial way to find vaccines and treatments.

Francis said it was also important to “guarantee universal access to essential technologies that allow each infected person, in every part of the world, to receive the necessary medical treatment.”

The President of Tanzania might be right

Coronavirus test kits used in Tanzania were dismissed as faulty by President John Magufuli on Sunday, because he said they had returned positive results on samples taken from a goat and a pawpaw.

One question: where’d he get the tests?

COVID-19 and Sweden: the true cost (no punches pulled)

Australia has spent at least $340 billion to save Australian businesses and families from Kung Flu.

Make no mistake, this is all borrowed money. The money that may flow to you today will be taken from you tomorrow … and the day after etc. For a generation at least.

Remember, in 2008 the Rudd Government began the GFC stimulus to avoid the ignominy of being a government overseeing a recession. The budget was on the cusp of surplus (according to Morrison and Frydenberg) when we got smashed by Kung Flu. Twelve years later!

The point?

These things take a long time to recover from. You can’t just get a budget from deficit to surplus overnight. Especially in a democracy.

So in addition to the $340 bn and whatever else we spend, the deficits will likely last for at least a decade. The cost will continue to mount for a long, long time.

Be very afraid.

Australia’s response to Kung flu was to lock down the economy.

Sweden took a different approach.

And a listener has asked, what has Sweden spent? What was their survival plan?

As they used to say on The Curiosity Show: “well, I’m glad you asked.”

What’s happened in Sweden?

There are two essential elements when looking at the cost of COVID-19 to the Swedish economy (and any economy for that matter), and one major problem:

  1. What has actually happened? In Australia, we know that the Australian Government (including the Reserve Bank) has allocated spending of $340 billion. It is almost certain that this will all be spent. Let’s put this in the ‘known’ column.
  2. What are the projections? This is more complicated because you have to trust economic forecasts. So the Australian Government, using projection, allocated that $340 bn because without X we’d get Y (and Y is awful … according to the projections). When looking at what’s happened in Sweden, we have to compare, in addition to what we know, with what we do not know (these are the projections). On the plus side, we are comparing what we think are apples with what we also think are apples. The assumption being that if the data is wrong, all of it will be equally wrong. Make sense?

And then we get the “major problem”. There is no counterfactual.

An example: when Dr Norman Swan tweeted this he was right (at the time) … but he was wrong a week later.

How wrong? Well, on 2 May at 3:00 pm, more than a month later, Australia had a total of 6783 cases. So much for “primary school maths”.

But there is no counterfactual. Maybe is we’d followed Sweden’s “don’t be stupid” protocol we would have more than 7000 cases and more than 93 dead. Maybe we’d have fewer.

NSW has 44 deaths. Let’s assume they are all in Sydney (most are).

Sydney’s urban area (not counting surrounding national parks) has a population density of 1171 persons per square kilometre and a total population of 5.2 million.

Stockholm is believed to account for half of Sweden’s 2700 COVID-19 deaths (say, 1350 as at 30 April 2020).

Stockholm has a population density of 4800 persons per square kilometre and a total population of 950,000 (estimates are varied, this is somewhat in the middle).

Population density matters. Comparing Sydney with Stockholm is unfair because the evidence so far suggests that when cities are more densely populated the chance of being infected increase (New York being the worst/best example).

London has had 5098 deaths (as at 2 May).

London has a population density of 4542 people per square kilometre and a total population of 9.0 million.

This is simply to try to compare apples with apples (as much as can be done).

On that note, it is absurd and downright to highlight the 67,000 US deaths without noting that the US has a population of 330 million (the third-most in the world), and that more than 13,000 of the deaths came from New York which has a population density of 10,000 per square km.

Here’s the truth about Sweden (via Stockholm). Stockholm has a death rate so far of about 1500 per million so far.

London has a death rate of about 570 per million.

And for the record, this is the deaths by age breakdown for Sweden:

Pretty similar for Australia … because this is the global picture:

All of that is designed to set the framework.

Now we get to cost.

Sweden: how many kronorydoos have they spent?

That’s a tough question.

JP Morgan has forecast Sweden’s economy will contract less than the euro area, with a 2.4 per cent contraction in the first quarter of this year and a 13.7 per cent percent contraction in the second.

That compares with projections of a 4 per cent and 17.3 per cent contraction for the euro area; 3.1 per cent and 16.6 per cent for Germany; and 4 per cent and 21.4 per cent for France, according to the bank’s report published on Friday.

In truth, not much of a difference.

But check this out. SEB, a Swedish bank, showed card transactions made through the bank fell by 28 per cent in Sweden in the week of April 6, much less than the 70 per cent in Finland and the 66 per cent in Denmark.

Swedish restaurant trade fell 70 per cent. Less than the near-100 per cent fall in Germany and the UK.

They’re true signs of economic activity.

Direct government support

Like Australia, the Swedish Government is covering the cost of laid off employees:

… employers will now be able to reduce their employees’ working hours by up to 80 per cent and that central government will cover a clear majority of the cost. This reinforcement of the system will apply for three months from 1 May 2020.

Business support for 180,000 Swedish businesses will cost Swedes SEK 39 billion (A$6.2 billion).

Other measures include a loan guarantee of 70 per cent of new loans banks provide to companies that are experiencing financial difficulty due to the COVID-19 virus but that are otherwise robust. The guarantee will be issued to banks, which in turn will provide guaranteed loans to companies.

Companies will also not have to pay social security contributions. Total cost: SEK 33 billion ($5.2 billion).

For small businesses, like Australia, the Swedish Government proposes providing support that aims to facilitate and speed up renegotiation of rents. The approach is that central government will cover 50 per cent of the rental reduction up to 50 per cent of the fixed rent. Cost: SEK 5 bn (A$800 million).

There is also a small business tax return program which will cost SEK 13 billion (A$2 billion).

VAT is also being deferred and this is expected to cost SEK 7 billion (A$1.1 billion).

The biggest ticket item is that the Swedish Central Bank (the Riksbank, which might be handy for trivia nights, you never know), has announced that it is loaning up to SEK 500 billion to companies via the banks to safeguard the credit supply. total cost in Aussie dollarydoos: $79 billion.

These are the headlines and basically are the same as the Australian and US governments have implemented. There are so doubt others, as there are in Australia.

But a rough, back-of-the-envelope cost is around A$95 billion. Although, in theory, the $79 billion through Riksbank is a loan and will be repaid (with interest), so the total cost is around $15 bn.

Remember, the Swedish population is about 10 million. So even on a population basis, it is significantly cheaper than Australia’s massive expenditure.

But wait, there’s more …

As with Norman Swan, many of the predictions and responses were made before we had decent knowledge of Kung Flu.

In the early days, we were told it had a fatality rate of 3 to 4 per cent. For comparison, the flu has a fatality rate of 0.1 per cent.

Also for comparison, in 2018-19, a total of 505 of 13,324 persons who received a laboratory-confirmed influenza diagnosis during the 2018–2019 season died within 30 days of diagnosis.

Patients who died ranged in age from 0 to 100 years, with a median age of 81 years of age. Patients who had not died within 30 days of diagnosis had a median age of 59 years. In total, 88 percent of deaths within 30 days occurred among people aged 65 years and older.

Ten per cent of deaths occurred among adults aged 40–64 years and two percent occurred in people under the age of 40 years. The age distribution reflects the circulation of influenza A(H1N1)pdm09 and the lower mortality burden seen among the elderly this season.

In other words, if you’re old and you get the flu, be worried.

But the truth is that COVID-19 has a far lower death rate than we were told. It’s nowhere near 3 or 4 per cent. It’s somewhere nearer to 0.25 per cent:

On Thursday, the University of Pittsburgh Medical Center’s chair of emergency medicine Dr. Donald Yealy claimed the fatality rate of the novel coronavirus is far lower than initially suspected, closer to .25%, based off Allegheny County data and extrapolations from New York and California randomized antibody testing.

That would make it 2.5 times worse than the flu. And as in Australia, most of the dead are over 60.

So knowing what we do now, wouldn’t it be wiser to treat this as a very bad flu?

Randy Travis (b 1959)

A classic country voice and a classic country song.