The Afternoon Audit
Wednesday | 6.17.2020

U.S. Coronavirus Cases Rise

Catch Up Quick

• 8 in 10 Americans worry about a second coronavirus wave

• WhatsApp launched in-app, contactless payment option

• Q2 S&P 500 earnings are expected to decline by 43.5% with revenues falling by 11.5%

• Recent data finds Black, Hispanic & Latino Americans have coronavirus mortality rates as much as 10x higher than White Americans

• Mortgage applications rose 8% from one week earlier for the week ending June 12

• Health officials flag coronavirus risk of Trump’s upcoming Tulsa rally

My Wednesday Opinions

• Zoom says it will no longer close accounts outside of mainland China at Beijing's request— as the company faces expulsion from China if they don't abide by government requests and criticism from the U.S. if they do, adopting multiple sets of values in accordance with vastly different ideologies may lend further problems in the long-run

• Optimism for treating seriously ill coronavirus patients is coming from a synthetic steroid called Dexamethasone, as it recently helped save patients' lives in a randomized, controlled trial— this could have a leg up on Remdesivir given it is a highly inexpensive, 60 year old drug with well-established production processes

• Contact tracing apps and software, once a promising solution to expedite a safe reopening, have largely been brushed under the rug by legislative bodies— this is another negative ramification of governmental disconnect with technology, as many experts say it is the key to controlling the spread of a disease for when there is no cure

Thought of the Day

• Regardless of whether buying is driven by institutional or individual investors, efficient markets, react upwardly to positive news and downwardly to negative news

• In my opinion, recently, this has been highly asymmetrical

• Stocks jumping on positive news does alone indicate overvaluation, but this is only the case if negative news brings prices down

• Equities rose yesterday based on higher than expected retail sales, which is sensible to a degree (year over year sales still declined by 6.1%)

• However, what about the record spikes in new coronavirus cases in six U.S. states?

• Not to mention, these states were the first ones to reopen, which could model where things are heading with the rest of the nation

The Bottom Line

• Regardless of whether or not you think these movements are valid, asymmetrical market efficiency creates bubbles

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