Florida’s governor DeSantis struggles with a protective mask

Before we get into our update, we just want to make sure you take action on an important matter.

Your Digital Assets – Include Them in Your Estate Plan
Last week we sent out an email invitation for a webinar on estate planning for digital assets. You may have missed it. Don’t worry. We’ll send the invitation again and we strongly encourage you to sign up.

What are digital assets? Simply, they’re assets that exist electronically and are (usually) stored online. This could include accounts for which you have a user ID and password, photos, music, virtual currency, documents, and social media. Think about how much of your life is conducted online.

What happens to all of this stuff after you die? It all depends on you. If you do nothing, it will be a mess. If you take action, organize your digital assets and include them in your plan, then your wishes for them will be honored.

The webinar is July 22 at 4:00 pm. After the webinar, we’ll be sharing a very helpful inventory for these assets that can be completed on your computer, saved and stored securely.

COVID-19 Numbers
Globally, across 213 countries and territories, there have been nearly 13 million confirmed cases and nearly 570,000 deaths. In the US, over 3.3 million have been infected and over 135,000 have died. The CDC believes 10 million Americans are already infected.

New cases of the novel coronavirus are accelerating across the country. Florida broke its previous single-day record with over 15,000 cases on Saturday. That was also a daily record for any state since the pandemic began. The number of daily infections in the US exceeded 60,000 for a third straight day.

New case counts in 13 other states were up by more than 20% in the past week. In another 32 states, new cases were up by 10% in the past week.

As a result, more than half of the states have suspended or rolled back their reopening plans in an effort to slow the spread of the virus. We can expect more aggressive action unless the numbers start heading in the desired direction.

Test is expanding, which is good. We need to detect infection, contrary to the assertions of certain government officials. However, we are also observing a rise in the infection rate. This tells us the virus is spreading. If we had the virus under control, we would expect to see the positive test rate level off and begin to fall.

This graph from Johns Hopkins tells the story.

https://coronavirus.jhu.edu/testing/individual-states

Source: Johns Hopkins University

Testing needs to accelerate for us to get out in front of the spread of the virus. Unfortunately, health care facilities are once again struggling to secure testing supplies. This is slowing the testing process and, as a result, the contact tracing process when new cases are identified.

In addition, health care providers in hard hit many places do not have adequate PPE (personal protective equipment). We cannot have these font-line defenders risking their lives. Far too many have become sick or, worse, died.

The Markets
On Friday, the Dow Jones Industrial Average was up 370 points, or 1.44%. The broader S&P 500 Index rose 33 points, or 1.05%. The Dow was up 1% for the week. The S&P 500 rallied by 1.8%.

The yield on the 10-year Treasury Note fell to 0.571%, an indication that investors are growing anxious about the spread of the virus. Spot gold, which traded at $1,581 (per ounce) at the beginning of the year, was trading at just over $1,801 on Friday. Investors generally move into US government securities and gold in times of uncertainty and worry.

In a sense, the stock market has a bet on COVID-19 and the federal government. It’s betting that the virus will not flare up so dramatically that it will force government officials to step back from their phased re-openings of the nation’s states and counties. It’s also betting the Federal Reserve, the Congress and the Administration will continue to provide massive support to the economy. If either of these bets is thrown into serious question, we should expect the market to shift to a “risk off” sentiment.

The Economy
The US economy contracted at a 31.9% annual rate in the second quarter, based on a Wall Street Journal survey of economists. They are projecting a recovery in the second half of the year, including 15.2% growth in the third quarter.

The US economy is slowly beginning to recover from this spring’s unprecedented shutdown to prevent the spread of COVID-19. The services sector, which makes up two-thirds of the economy, is healing.

The Labor Market
The Labor Department announced that an additional 1.3 million workers filed for unemployment benefits for the week ending July 4. This was another decline from the prior week. Claims for unemployment benefits have exceeded 1 million for 15 straight weeks. The previous weekly high was 695,000 in 1982. A total of 18.1 million Americans are receiving unemployment benefits.

The Labor Department also reported that 1.8 million workers were laid off in May, following 7.7 million in April and 11.5 million in March.

The separate jobs report showed that employers added 7.5 million jobs in May and June after dropping 22.2 million jobs in March and April.

Benefits Expiring
Congress needs to address a very large and looming problem. The enhanced unemployment benefits that so many laid-off workers have relied upon during the pandemic expire at the end of July. Without some form of extension of these benefits, many of these Americans will be stressed financially.

It’s true that some people are receiving more in government benefits than they earned while they were working. This is bad policy and needs to be addressed. But the government cannot abandon millions of workers who lost their jobs as a direct result of their employer’s response to the economic shutdown.

Housing in a Pandemic
Most, if not all of us, have always lived with secure housing. However, that is not the case for millions of Americans. When COVID-19 hit, the federal government and states passed moratoriums on evictions for renters who couldn’t pay their rent and homeowners who couldn’t pay their mortgage. The reprieve was meant to prevent massive additional homelessness.

However, the period of exemption is beginning to expire in many jurisdictions. The Colorado-based COVID-19 Eviction Defense Fund reports that 19-23 million Americans are at risk of eviction by September 1. Action is needed to keep people safely sheltered.

Schools
The government is trying to figure out how to open schools in the fall. We all want our kids back in school. However, there is a lack of consensus about whether this can be done safely and, if so, how. Last week we saw a disturbing lack of coherent, coordinated guidance coming from the Administration and the CDC. It is rather apparent that schools will need resources they don’t have to open safely and the federal government will need to provide the funding for those resources.

Aerosol Spread – An Update
A few weeks ago, I mentioned my experience with aerosol transmission while hiking in the Columbia River Gorge. I wondered about the possibility of transmission of tiny particles in the air after smelling an unnatural, man-made scent well before I came up to the person from whom it came. I’ve since noticed this several times as I hike in Oregon and Washington.

Well, the World Health Organization finally came out last week and acknowledged that aerosol transmission is possible. We have yet to see government health officials announce any significant revisions to their guidance to prevent the spread of the virus in light of this announcement. The WHO did indicate, however, that as much as half of all transmissions may come from those who are asymptomatic. This is highly problematic, because the virus can incubate for up two weeks. So, individuals can get infected, not know it and spread it extensively, depending on their social interactions.

We are still learning about this virus. It is a very powerful foe and it will demand the best of those combatting it.

The Way Out
Many weeks ago, Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases and a key member of the largely-inactive White House Coronavirus Task Force, said the virus is in control. It was and it is.

We will continue to highlight the path out of this crisis, because the steady stream of alarming news related to the pandemic can overwhelm our critical thinking.

We need continue to practice good social and hygiene practices. We were encouraged to see the President finally follow the guidance of federal health officials and wear a mask.

We need coordinated, extensive and accurate testing of all citizens. While testing has improved, it’s still wholly inadequate.

We need to isolate and care for, as necessary, those who test positive. Some will need little care. Others will end up in an ICU unit fighting for their lives.

We need a health care system that can care for those who are infected without becoming overwhelmed. That means expanded facilities and more medical supplies.

We need rapid, comprehensive contact tracing. While our tracing capacity is more robust, hard-hit areas are still quickly overwhelmed. We cannot have asymptomatic but infected people wandering around in society.

We need effective treatment for COVID-19. Scientists are making progress every day. Drugs are proving more effective than in the early days of the outbreak. But better treatment is needed.

Ultimately, we need a vaccine and a global distribution system. This seems to be still far out of reach. But only when we have an effective vaccine will life on this planet return to some sense of normal.

A Note About Our Communications
We are now corresponding with you every Monday. We seem to be on a very long march. So, we have slowed our pace a bit. We will, of course, share our thoughts more frequently, as the circumstances warrant.

We encourage all of you to remain vigilant. We are far from the other side of this pandemic and it will continue to profoundly affect our lives.

Keep the faith, be safe and stay healthy.

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