The Delta variant doubles the risk of hospitalization—but the vaccines still work

Link: https://www.technologyreview.com/2021/06/15/1026365/the-delta-variant-doubles-the-risk-of-hospitalization-but-the-vaccines-still-work/

Excerpt:

The good news? Vaccines still sharply reduce the risk of being admitted to hospital with the Delta variant. The Scottish study found that the Pfizer/BioNTech vaccine provided 79% protection, two weeks on from the second dose, while the Oxford/AstraZeneca vaccine offered 60% protection. That lower rate may be due to the fact that it takes longer for immunity to develop with the Oxford/AstraZeneca vaccine, researchers said. 

However, research released shortly after by Public Health England was even more promising. It found that the Pfizer/BioNTech vaccine provides 96% protection from hospitalization after two doses, while the Oxford/AstraZeneca is 92% effective at preventing hospitalization after both shots. The conclusion? It’s yet more evidence of the importance of making sure as many people as possible get vaccinated, and that they get both shots.

Author(s): Charlotte Jee

Publication Date: 15 June 2021

Publication Site: MIT Tech Review

NJ PFRS Asset Move

Graphic:

Excerpt:

The New Jersey Police and Firemen’s Retirement System (PFRS) was supposed to get their assets to invest three years ago but the process seems only to be starting now with an RFQ for Class Counsel that the PFRS board sent out yesterday.

Here is how much is involved.

From the latest Division of Investment report there is about $89 billion to split up.

From the latest actuarial reports for the system PFRS is allocated about one-third of the market value of assets:

Author(s): John Bury

Publication Date: 15 June 2021

Publication Site: Burypensions

Mortality Nuggets: NYT Misleads, COVID Deaths Down, and Car Crash Fatalities Up

Link: https://marypatcampbell.substack.com/p/mortality-nuggets-nyt-misleads-covid

Graphic:

Excerpt:

I want you to notice something — the blue bars are the “with COVID” portion of deaths, and the chartreuse bars are the ones “without COVID”. The bars are weekly counts of deaths when they occurred. Ignore the most recent weeks because they don’t have full data reported yet.

The red pluses indicate excess mortality, defined as exceeding the 95th percentile for expected mortality for that week (so it includes seaonality). You can see the excess mortality from the 2017-2018 flu season, which was bad for a flu season.

The non-COVID mortality has been in excessive mortality range for almost all 2020 after March. But since the beginning of 2021, it has dropped off…. and COVID mortality has also dropped off.

I think we may be almost in “normal” range soon. We shall see!

Author(s): Mary Pat Campbell

Publication Date: 13 June 2021

Publication Site: STUMP at substack

A Made-in-Washington Inflation Spike

Link: https://www.wsj.com/articles/a-made-in-washington-inflation-spike-11623362377?mod=opinion_lead_pos1

Excerpt:

The Labor Department’s consumer price index surged 5% year-over-year in May, the largest increase since August 2008 when oil was $140 a barrel. But don’t worry, Americans. The Federal Reserve says inflation is “transitory” and that it has the tools to control prices if they start to spiral out of control. Let us pray.

Nobody should be surprised that prices are increasing everywhere from the grocery store to the car dealership. Demand is soaring as the pandemic recedes while supply constraints linger, especially in labor and transportation. As always, this is a price shock largely made by government. Congress has shovelled out trillions of dollars in transfer payments over the past year, and the Fed has rates at zero while the economy may be growing at a 10% annual rate.

The personal savings rate in April was 14.9%, double what it was before the pandemic. Record low mortgage interest rates have enabled homeowners to lower their monthly payments to burn more cash on other things. Congress’s $300 unemployment bonus and other welfare payments for not working have contributed to an enormous worker shortage, which is magnifying supply shortages.

All of this is showing up in higher prices. Over the last 12 months, core inflation excluding food and energy is up 3.8% and much more for used cars (29.7%), airline fares (24.1%), jewelry (14.7%), bikes (10.1%) and footwear (7.1%). Commodity prices from oil to copper to lumber have surged. Higher lumber prices are adding $36,000 to the price of a new home.

Author(s): Editorial Board

Publication Date: 10 June 2021

Publication Site: WSJ

The Federal Reserve’s Ballooning—and Risky—Balance Sheet

Link: https://mises.org/power-market/federal-reserves-ballooning-and-risky-balance-sheet

Excerpt:

The Fed has embarked on a massive expansionary quest in recent years. In 2020, total Reserve Bank assets rose from $4.2 trillion to $7.4 trillion amidst the pandemic and related government lockdown and fiscal “stimulus” policies. That was roughly three times the extraordinary growth in the consolidated balance sheet for the Reserve Banks in the 2008-2009 financial crisis. And in the latest weekly “H.4.1” release, total assets were up to $7.8 trillion – rising about a hundred billions dollars a month so far this year. 

….

Today, short and long-term interest rates on government bonds rest near historic lows, important in part because the Fed massively expanded its purchases of government bonds. But low interest rates can’t be taken for granted, particularly if we get significantly higher inflationary expectations — which appear to have begun to sprout in recent weeks.  

If we get significantly higher interest rates for that reason, the Reserve Bank balance sheet impact from losses on securities assets would arrive if the losses become “realized” – a realistic prospect if the Federal Reserve  reverses course and starts selling off securities as a means of conducting monetary policy amidst higher inflationary expectations.

Author(s): Bill Bergman

Publication Date: 28 May 2021

Publication Site: Mises Institute

The Social Security shell game

Link: http://exclusive.multibriefs.com/content/the-social-security-shell-game/civil-government

Excerpt:

According to The Senior Citizens League, the sleight of hand behind it is a formula for calculating the Cost of Living Adjustment (COLA) that has robbed seniors of 33% of their buying power since 2010.

Since then, annual COLA increases have averaged a meager 1.375%. That means the average recipient has received a COLA increase of less than $20 a month. For many, the con job is even more vexing because much of that gain is taken back with increases in Medicare premiums.

These annual COLA adjustments are based by the U.S. Bureau of Labor Statistics (BLS) on a formula that uses the Consumer Price Index for All Urban Wage Earners and Clerical Workers — a lengthy descriptor that’s usually abbreviated as CPI-W. Therein lies the problem — this index does not accurately reflect the rising costs that most affect seniors — such as medical care and drugs, food/staples and rent. Even the most modest estimates suggest these costs are increasing at a rate of somewhere between 5% and 10% annually.

Author(s): Dave G. Houser

Publication Date: 5 March 2021

Publication Site: Multibriefs

Positivity with Paul: Episode 5 | Mary Pat Campbell

Video description:

Welcome to another episode of Positivity with Paul, where I find Fellow Actuaries – pun intended – for a conversational Q&A on their life.  The focus is on their journey along the actuarial exam path and beyond, some of the challenges they faced, and how those challenges helped shape them to become who they are today.   

To give some brief context on becoming an Actuary, there’s a number of actuarial exams that one has to go through.  These exams are very rigorous and typically, only the top 40% pass at each sitting, They cover complex mathematical topics like statistics and financial modelling but also insurance, investments, regulatory and accounting.  Candidates can study up to 5 months per sitting and they will take 7 to 10 years on average to earn their Fellowship degree. To that end, I launched this series of podcasts because I was curious about what drove my guests to surmount trials and tribulations to get to the end goal of becoming an Actuary.    

My guest in this interview is Mary Pat Campbell. Mary Pat is an actuary working in Connecticut, investigating life insurance and annuity industry trends. She has been interested in exploring mortality trends, public finance and public pensions as an avocation. Some of these explorations can be found at her blog: stump.marypat.org. Mary Pat is a fellow of the Society of Actuaries and a member of the American Academy of Actuaries. She has been working in the life/annuity industry since 2003. She holds a master’s degree in math from New York University and undergraduate degrees in math and physics from North Carolina State University. In this podcast, Mary Pat discusses similarities in concepts between physics and actuarial science, the current low interest rate environment and lessons learnt in the insurance sector from the financial crisis in 2008-2009. Hope you enjoy this all-inclusive interview! Paul Kandola

Author(s): Paul Kandola

Publication Date: 11 June 2021

Publication Site: Integral Actuarial at YouTube

Which Groups Are Still Dying of Covid in the U.S.?

Link: https://www.nytimes.com/interactive/2021/06/10/us/covid-death-patterns.html

Graphics:

image

Excerpt:

“Previously, at the start of the pandemic, we were seeing people who were over the age of 60, who have numerous comorbidities,” said Dr. Krutika Kuppalli, an infectious disease expert at the Medical University of South Carolina. “I’m not seeing that as much anymore.” Instead, she said, hospitalizations have lately been skewing toward “people who are younger, people who have not been vaccinated.”

More than 80 percent of those 65 and older have received at least one dose of a Covid-19 vaccine, compared with about half of those aged 25 to 64 who have received one dose. Data collected by the C.D.C. on so-called breakthrough infections — those that happen to vaccinated people — suggest an exceedingly low rate of death among people who had received a Covid-19 vaccine.

Author(s): Denise Lu

Publication Date: 10 June 2021

Publication Site: New York Times

National Public Pension Coalition vs. Truth in Accounting: Who is Accurate With Public Pension Unfunded Debt?

Link: https://marypatcampbell.substack.com/p/national-public-pension-coalition

Graphic:

Excerpt:

NPPC, I recommend you think through what will actually inform and protect your members. The TIA folks are not distorting the message, except to the extent that state and local governments are undervaluing their pension and OPEB promises.

Complaining about TIA will not make the pensions better-funded. Complaining about TIA will not prevent the worst-funded pensions from running out of assets, which will not be supportable as pay-as-you-go, as the asset death spiral before that will show that the cash flows were unaffordable for the local tax base.

And don’t look to the federal government to save your hash. So far bailout amounts have been puny compared to the size of the promises.

Author(s): Mary Pat Campbell

Publication Date: 9 June 2021

Publication Site: STUMP at substack

Illinois targets coal plant closures before all bonds retire

Link: https://fixedincome.fidelity.com/ftgw/fi/FINewsArticle?id=202106071513SM______BNDBUYER_00000179-e7af-dd1a-ab7d-efefe4190001_110.1

Excerpt:

A proposed mandate to shutter the $5 billion Prairie State coal energy campus and a Springfield, Illinois? plant by 2035 would hit local ratepayers with the double burden of funding new energy sources while still paying down project bonds, a bipartisan group of state lawmakers warn.

Gov. J.B. Pritzker backs a state mandate to end coal generation by 2035 to meet de-carbonation targets included in pending energy legislation. The package stalled during the General Assembly?s spring session that ended last week, but Pritzker said he expects lawmakers will return in the coming weeks for a vote.

…..

Retiring Prairie State early would mark the latest headache for some of the nine public utilities in Illinois, Indiana, Kentucky, Missouri, and Ohio that issued $4.5 billion of debt, some it under the federal Build America Bond program, to finance their ownership in project.

Peabody Energy Inc. initially sponsored the project in Washington County promoting it as an affordable source of energy with an adjacent mine and a cleaner one given its state-of-the-art technology at the time. Bechtel Power Corp. built it. It initially carried a $2 billion price tag that rose to a $4 billion fixed cost under the 2010 contract with utilities but cost overruns drove the price tag up to $5 billion.

Author(s): Yvette Shields

Publication Date: 7 June 2021

Publication Site: Fidelity Fixed Income

Chicago Park District pension revamp takes fund off road to insolvency

Link: https://fixedincome.fidelity.com/ftgw/fi/FINewsArticle?id=202106081343SM______BNDBUYER_00000179-ec17-d1ac-a5fb-ef37eda90001_110.1

Excerpt:

The Chicago Park District pension funding overhaul approved by lawmakers moves the fund off a path to insolvency to a full funding target in 35 years, with bonding authority.

State lawmakers approved the statutory changes laid out in House Bill 0417 on Memorial Day before adjourning their spring session and Gov. J.B. Pritzker is expected to sign it. It puts the district?s contributions on a ramp to an actuarially based payment, shifting from a formula based on a multiplier of employee contributions. The statutory multiplier formula is blamed for the city and state?s underfunded pension quagmires.

“There are number of things here that are really, really good,? Sen. Robert Martwick, D-Chicago, told fellow lawmakers during a recent Senate Pension Committee hearing. Martwick is a co-sponsor of the legislation and also heads the committee.

?This is a measure that puts the district on to a path to full funding over the course of 35 years,” he said. “It is responsible. There is no opposition to it. This is exactly more of what we should be doing.”

The district will ramp up to an actuarially based contribution beginning this year when 25% of the actuarially determined contribution is owed, then half in 2022, and three-quarters in 2023 before full funding is required in 2024. To help keep the fund from sliding backwards during the ramp period the district will deposit an upfront $40 million supplemental contribution.

The 35-year clock will start last December 31 to reach the 100% funded target by 2055.

Author(s): Yvette Shields

Publication Date: 8 June 2021

Publication Site: Fidelity Fixed Income