| | If you are cheering for gold these days , you will be cheering on Covid-19-Delta. I know some what macabre.
The hotspot in the world for C-19 is once again the USA. On the official numbers it has 25% of new cases worldwide.
Some background numbers: - The US reports a total of 37.7M cases since the start, and 628K deaths, a rate of 1.7% deaths to cases. - On Aug 21 the US reported 150K cases and 1500 deaths , a rate of 1%. (deaths is a lagging indicator, and since the spike in cases is recent, the 1% is probably low) -There are approximately 150M people, including children, who are not vaccinated in the USA. My take then is that maybe some of the unvac'ed already had C-19, some fence sitters are now scared and getting vaccinated, so let's guess 100M ready to welcome Delta. Note: children can very much get C-19 and they don't all recover easily. And also this doesn't account for the breakthrough infections that are quite frequent, especially with those vaccinated early , like 6 months ago, and often their sickness is mild , but not always.
OK. So the USA is pretty vaccinated, so things will be ok then, right? Well, some experts who have been pretty accurate so far on predicting results, have recently said that with Delta being so contagious, that everyone who is not vaccinated, and many who are, will get the virus. Period. Sure, with a 90% vac rate, and some careful behaviour, maybe an area can keep the numbers low.
But only 51.9 % are double vac'ed in the US, and in some states it is almost illegal to wear a mask, and nowhere has serious containment. (Compare this to NZ, which is in Stage4 lockdown, the toughest, country wide, all because of one case discovered, and NZ has similar vac rates as some spots in the USA). And even in states with pretty high vac rates , see Oregon, without a lockdown, cases are soaring.
Given all this, it seems reasonable to think that everyone in the USA who is not vac'ed will mostly get C-19-D. The US will not return to a lockdown, and if they do it would be much too late. Even if everyone got vaccinated tomorrow who hasn't the first shot, it takes a couple months to get the second dose and full protection. This will all play out on a shorter time frame than that. Now as far as deaths go, and I said this is a little macabre , and maybe you think I am a little gleeful (actually what I feel is none of your business) , if the 1% rate holds on those 100M vulnerables, well, you get the idea. But isn't it true that treatments are better and evolving? That's true but you need to be able to get into a hospital to get those treatments. And 5 states in the USA are close to maxed on ICU beds taken already, and this is just starting. The lines on the graphs point straight up.
Anyway, this is giving me a reason to read the news everyday. What I am saying seems logical, but boy o boy , so much isn't logical these days. Like EDV share price for example. It seems the market is worried that the US economy will soar , based on indoor dining picking up, and gold will drop like a brick in water, and US stocks will rise forever - so why buy gold or gold co's. I did a simple calc the other day on EDV, and at $1200 gold EDV would still be a great co. Probably worth what it is now. At $1200 gold it would still make $800M over cash costs in 2023 when production gets to 2M oz. Might have to pare back the dividend and stock purchases a little, but everything else would carry on. And my thinking is $3000 gold is as likely as $1200.
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