Covid-19: Where We Go From Here

From Goldman Sachs Research, this is Allison Nathan. Welcome to Top of Mind, a podcast that explores macroeconomic issues on the minds of our clients. In this episode, we're again focusing on the ongoing COVID nineteen pandemic as countries around the world continue to grapple with managing virus spread while restoring economic activity. Indeed, the strong economic recovery underway since mid April appears to have stalled in some places like Spain, Japan, and parts of The US that have been forced to roll back reopenings to stem new outbreaks. Where the virus will go from here, what that means

We are hearing some people suggesting that we've actually reached a peak in this pandemic globally. Do you think that is the case? I

think it's really hard to predict what will happen globally, but, a, there are many places that are showing signs that there are plenty of susceptible people around and, b, control measures are not gonna stay in place for very long or very intensely or or maybe have already been let off like much of The US. And if you have susceptible people and virus and inadequate control measures, cases will go up. In many parts of the world, there is a lot of room for the virus to run still. I got asked by one world leader actually, an honest question that they had been told by someone that viruses are a b

With this in mind, doctor Lipsitch explains that three factors will determine the virus's path in the coming months: herd immunity, seasonality, and control measures.

Without enough herd immunity, you do not get a decline unless it's seasonal factors or control measures. The three things are all multipliers on the reproduction number. Sometimes people think about herd immunity as a yes, no, or threshold effect, but it's actually a continuous quantity. It's something that initially does nothing to slow the virus and then as more people get infected, a little bit slows the virus. And then as more people get infected, slows it even more. I think there are some places that are gonna have measurable impact from bird immunity on seasonality. I think we have confi

Doctor Lipsitch says he's least worried about virus resurgence in places that have already been hit hard by the disease, and he also thinks that countries with a clear national strategy to control the disease will have more success in doing so. One

observation I've made in this pandemic is that, especially in The United States, there seems to be a very local, like, city or state level experience of if you get hit with a big wave once, then you are much more cautious. It's kind of like a companion notion to herd immunity that it's not real herd immunity, but once the population has experienced the horrors of a really big surge in cases, then control measures seem much more real and valuable. So I'm more optimistic in places that have had a really horrible summer, like Florida and Texas and Arizona, because I at least hope that they will t

But doctor Lipsitch views the resolution of the pandemic in 2021 as a best case scenario, even with the help of a vaccine. And he says we won't know if that timeline is achievable until at least the middle of next year.

Everyone's looking to next year as the year that this will be resolved. Do you agree with that?