An unfortunate start to the week. Covid-19 has re-emerged in NZ, and with it, level 3 lockdown in Auckland and level 2 lockdown in the rest of the country. Yesterday, people waited with bated breath for the announcement of potential easing or toughening of lockdowns coming at 5:30 pm. When the time came, Prime Minister Jacinda Ardern announced that the lockdowns would continue until at least Wednesday the 26th, allowing many to breathe a sigh of relief that the restrictions were not harsher [1]. Due to this new round of lockdowns, the government has made an in-principle decision to extend the wage subsidy, with more details coming after the weekend [2]- the subsidy was planned to end on the 27th of September.

In my opinion, the best-case scenario would be if the Ministry of Health managed to find the source of the outbreak and thorough targeted and untargeted testing showed up very few new cases. However, even in this case, it is likely that the lockdown, at least in Auckland, would have to extend a further week to ensure that there was no further transmission going undetected. A more likely case is that there will be cases popping up for the next few weeks, resulting in lockdowns continuing for another month or two. Professor Shaun Hendy gave a worst-case scenario as there being 100 undetected cases of Covid-19 at the moment, which could result in further clusters being found and level 4 being the next step [3].

This outbreak has led to political parties suspending their general election campaigns and a fair amount of politicking, with National pushing for the election to be delayed to November or even 2021 [4] [5]. Additionally, there have been many conspiracy theories and misinformation going around to do with Covid-19, leading to the Prime Minister having to address them as dangerous [6].

Leaving New Zealand to look at the rest of the world the picture does not get much better. The world has surpassed 20 Million cases and 750,000 deaths [7]. The US accounts for approximately 25% of the world's cases and is fast approaching 5.5 Million. India and Brazil are also not doing well, with 2.4 Million and 3.1 Million cases, respectively.

In somewhat positive news, Russia has approved a vaccine for Covid-19 called Sputnik V, harkening back to Russia wining part of the space race to get a satellite into orbit [8]. However, this must be taken with a massive grain of salt, as Russia approved the vaccine before it has been fully tested. This is a massive gamble. It may pay off- providing a >50% immunity to Covid-19 and little to no side-effects- or it may backfire- failure to provide immunity and causing significant side-effects. While geopolitics has many lining up to downplay the vaccine, it has to be said that if the vaccine works it will be a boon for all of society. It must also be noted that many other vaccines are further ahead in the normal regulator testing than Sputnik V, so it is not as if the Russian vaccine is anything all to impressive.

On the economic front, the UK has officially entered a recession after estimates for Q2 GDP came out showing a record 20.4% drop [9]. This is the UK’s first recession since the Global Financial Crisis, when the UK entered a recession in January 2009 [10]. It should be noted that this is a lagging indicator, being for the period April to June.

In the US, talks between Democrats and Republicans have broken down again, with the Senate going on break without achieving a deal [11]. This means that millions of US citizens are going without the benefits that they require to survive.

Finally, Joe Biden, the presumptive Democratic nominee, finally announced his pick for vice-president- Kamala Harris [12]. Kamala is more progressive than Biden, so it will be interesting to see how this affects the public's view of the campaign.

Video picks of the week-

- ‘Ardern: Going Hard and Early Is Best Course Against Virus’ https://youtu.be/t7BkcP5hmh4. This is a snippet of one of Jacinda Ardern’s press conferences where she reassures the country.

- ‘Covid-19: When will a vaccine be ready?’ https://youtu.be/FgR6t7vQtn8. The Economist produced a video that covered a wide range of concerns about Covid-19 vaccines, from the cost/benefit of vaccination to the time required to vaccinate the whole world.

- ‘How investors become gamblers’ https://youtu.be/pjJNYbbnBg4. An interesting video, especially for new investors or those who are thinking of putting large sums of money into the market right now.

- ‘Coronavirus vaccine: UK and EU ink deal with pharmaceutical companies for COVID-19 vaccine’ https://youtu.be/ucRoKQwW1Oc. This video by Yahoo Finance has an important slide at 1:50 that shows the phases that eight different vaccines are in. The Russian vaccine- Sputnik V- is in phase 3.

References

[1] D. Cheng, "Covid 19 coronavirus: Prime Minister Jacinda Ardern - NZ to maintain current lockdown setting for 12 more days," New Zealand Herald, 14 August 2020. [Online]. Available: https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12356647. [Accessed 15 August 2020].

[2] G. Robertson, "Govt to protect jobs and businesses with extra support," New Zealand Government, Wellington, 2020.

[3] S. Hendy, Interviewee, Shaun Hendy says there could be 100 undetected Covid cases in the community in the worst case. [Interview]. 14 August 2020.

[4] Radio New Zealand, "Election campaigning suspended due to new Covid-19 alert," 12 August 2020. [Online]. Available: https://www.rnz.co.nz/.

[5] Radio New Zealand, "Collins calls for election to be pushed back to late November or 2021," 12 August 2020. [Online]. Available: https://www.rnz.co.nz/.

[6] C. Broughton, "Coronavirus: 'Dangerous' Covid-19 conspiracy theories on the rise," 14 August 2020. [Online]. Available: https://www.stuff.co.nz/.

[7] World Health Organisation, "Coronavirus disease (COVID-19): Situation Report - 207," 2020.

[8] H. Foy, "West's response to Russian vaccine owes as much to geopolitics as science," Financial Times, 13 August 2020. [Online]. Available: https://www.ft.com/.

[9] Office for National Statistics, "GDP first quarterly estimate, UK: April to June 2020," Office for National Statistics, 2020.

[10] Office for National Statistics, "The 2008 recession 10 years on," Office for National Statistics, 2018.

[11] Yahoo Finance, "Stimulus talks break down, Senate not returning until after Labor Day," Youtube, 2020.

[12] Joe Biden, 'Kamala Harris | Vice President Announcement | Joe Biden For President 2020," Youtube, 2020.