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Icelandic insights

Good morning! Victoria recorded 20 new cases yesterday, with 15 of them either active in the community while infectious or 'unspecified'.

Chart showing Victoria's COVID-19 cases by status.
The number of Victorians infectious while in the community hasn't dropped. covid19data

Given that Premier Daniel Andrews said cases would need to be "as low as possible" for the lockdown to be lifted as planned tomorrow, it's not looking good for Melburnians. For those in NSW, it's shaping up to be a long winter (a record-breaking 356 new cases and 3 deaths – none vaccinated – yesterday 😔).


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The US S&P500 resumed its winning ways overnight, rising 0.1% to a fresh record after the Senate approved the $US1 trillion infrastructure bill. The House still has an opportunity to amend the bill to fix certain issues (e.g. the controversial crypto provisions) before it's moved for a floor vote.

Locally, the ASX200 jumped a solid 0.32% as more than 20 companies hit one-year or record highs on the back of positive earnings, with big gains for lithium players Orocobre and Pilbara Minerals after JPMorgan raised its long term-lithium spodumene price forecast by 31%.

Confidence down: The NAB Monthly Business Survey for July showed a sharp decline in Australian business confidence from June, with all industries except for mining and construction back in negative territory. No surprises that businesses in locked-down NSW are the least confident, with mining powerhouse WA the only bright light at +7 index points.

Consumer despair: It wasn't much better for consumers, with the ANZ-Roy Morgan Consumer Confidence Survey for last week falling 3.1% to well below the 2021 weekly average. Consumer sentiment is now "in pessimistic territory for the first time since early November last year", which might go some way to explaining ScoMo's poor recent polling.

Fastest in 30 years: GDP growth in the Philippines soared 11.8% in the June quarter off a low base (this time last year GDP shrunk by 17%). New restrictions implemented in August mean this is almost certainly a one-off, with President Duterte's government targeting 6-7% growth this year after a 9.6% contraction in 2020.

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Icelandic insights

Iceland. What's not to like? It's an island (like us!), was conducting large-scale coronavirus testing of its population before Australia even put up its hard border, made test and case data easily accessible before anywhere else and best of all, it's permanently mosquito-free (yes unrelated but a cool fact, no?).

That all makes Iceland a good country to analyse, because unlike some countries cough US cough its track and trace system manages to pick up most infections in vaccinated people, even if they have no symptoms. And that's important, because while Iceland is experiencing its largest wave of SARS-CoV-2 infections to date in absolute terms, cases are only accelerating amongst the unvaccinated.

Charts showing how data can be used to mislead or inform.
The chart on the left may make you think vaccines don't work, while the one on the right controls for the 'base rate fallacy'. Hjalmar Gislason

Digging deeper: 93% of Iceland's population aged over 16 years are fully vaccinated – well above the target Australia's government set to enter its Freedom Zone. Thankfully, vaccines appear to be working both at preventing infections and most importantly, reducing hospitalisations and deaths. Despite having about the same number of cases per million people as the US (where ~70% aged over 16 are fully vaccinated), Iceland has 3.5 times fewer people per million in hospital and has yet to record a fatality in this wave.

Why this matters: Politics. If a country with a 90%+ adult vaccination rate cannot accept rising cases and hospitalisations, that does not bode well for 'zero COVID' Australia. The next few weeks and how Iceland's policymakers respond to the current wave will provide an indication of what might expect to happen down under when Australia starts to reopen.

The Wrap Up

  • 💰 Economists at UBS estimated that the lockdown in NSW has an economic cost of $A1 billion a week.
  • 🛂 Iain Martin, the head of Victoria's fourth-biggest uni Deakin University, said "Once the entire adult population has access to vaccination... we need to consider very carefully whether we mandate vaccination to continue to be part of our university community."
  • Whoops. The Cleveland Indians recently rebranded to the Cleveland Guardians. "One problem: A male roller derby team in that city has been using the Guardians name for nearly a decade—and it owns the website tied to it as well."
  • 🤪 No comment, we'll just bold the first few words – "Confused anti-vaccine protesters stormed what they thought was a major BBC building on Monday, apparently unaware the corporation largely moved out almost a decade ago."
  • 💳 Australia's buy now, pay later competition is getting intense, with upstart Klarna (2% of Afterpay's merchant market share) temporarily waiving its 5.5% merchant fee for a period of six months.
  • 🦗 Cricket wants to be an Olympic sport, pushing for a 2028 spot in Los Angeles. T20, ODIs or the new 100-ball format are all options.
  • 🕵️‍♀️ Pushback grows against Apple's decision to backdoor its devices, with almost three dozen organisations and over 6,600 cryptographers, researchers and security, privacy and legal experts signing an open letter against the move.
  • 🚀 NASA's $US2 billion Perseverance rover tried to gather its first rock core on Mars, only for the sample to vanish...
  • 🙅‍♀️ New York governor Andrew Cuomo resigned ahead of "almost certain impeachment and conviction in the state Legislature", for multiple accusations of sexual harassment.
  • 😮 A police investigation in Germany found that a Red Cross nurse may have injected around 8,600 elderly people with a saline solution instead of a COVID-19 vaccine.