When the Story Bends


The pandemic narrative changed this weekend. I’m guessing you felt it.

Let me show you what you probably felt.

Pictured below is a network graph of articles published by high-circulation US media outlets about COVID-19 the weekend of March 14th and 15th. Closely clustered articles and those connected by lines are more similar in the language they use. Bold-faced nodes and connector lines are those which we judge to be about the stock market, the economy, unemployment and a prospective recession. Colors reference different language-based clusters assigned by the graphing algorithm. The lighter, faded nodes and lines are those which are about other topics.

Source: Epsilon Theory, Quid

And here is a network graph of articles published this most recent weekend (in case you’re curious, we chose parallel weekends to minimize bias relating to the tendency of weekday news to skew towards financial markets).

Source: Epsilon Theory, Quid

Even if you know nothing about what these graphs are doing or what they mean, my guess is you will notice two things. You’ll notice there are a lot more bold-faced dots this weekend than last. That just means outlets published a lot more pandemic articles that referenced the economic impact, too. That isn’t nothing, but in our opinion it isn’t the most interesting feature of the graph. Much more interesting to us is that the articles with language about economics impact and financial markets are far more well-distributed AND far more central. They don’t exist alongside other pandemic-related topics: they are explicitly integrated into EVERY pandemic-related topic.

In less than one week, the narrative shifted from “COVID-19 is a public health crisis” to “COVID-19 is a financial crisis.”

Such is the power of the narrative missionary.


Don’t mistake me. It IS both. Obviously it is both. The economic crunch that will be felt by hourly workers, service workers, and small business owners will go beyond whatever Congress’s bill will have the ability to rectify. It is very real. There are second-order effects and frictional effects that are very real. An SBA loan facility may not be able to restart a restaurant that already closed. A relief check may not be able to pay rent on an apartment someone has already been evicted from. A world in which people are allowed to go back into public doesn’t mean people are immediately going to crowd back into theaters to watch performing artists. This is going to be bad. This is going to be unevenly felt. We cannot predict all of those effects. That’s why we should all be creative in looking for ways to provide bottom-up support for those communities. That’s why we should continue to prod targeted sacrificial giving to local communities from all Americans.

That’s also why any time and treasure spent thinking about large public equity-holders who knowingly took equity risk in for-profit enterprises is time and treasure wasted.

But even if COVID-19 IS both a public health crisis AND a financial crisis, it should still matter to us when we observe a rapid, coordinated shift in the framing of it across public figure statements and media.

As always, the most important question we can ask when consuming media is this: why am I reading this now?

I can’t tell you that there are not people who examined the situation last week and suddenly came to earnest conclusions that the economic costs to small businesses and families might be more extreme than they thought. Surely such people exist. But I can also tell you that the overlap between groups promoting this framing and those who two weeks prior called it a media-fueled panic and those who two weeks prior to that called it ‘just the flu’ is significant.

If I had been calling something a ‘hoax’ and a ‘panic’ only to find out that I was dreadfully wrong, can you imagine how seductive it would be to be handed a way to retcon a new reality? How delighted might I be to say what I was really doing all along wasn’t completely mismanaging an unfolding pandemic, but instead carefully weighing the pluses and minuses of subjecting the population to massive economic pain or a medical crisis?

I’m really not being cynical. It really is seductive. I really am empathetic. I really do think that public servants who want to do good and know they’ve messed up the response thus far are grabbing this as a lifeline. And I really do believe that many (okay, some) of them are NOT just worried about how stocks are doing, but about how families and towns and communities are doing.

But the answer is NOT the arbitrary, panicked rejection of the distancing and quarantine measures put in place across the country.


Friends, we can carry multiple ideas in our head at the same time. We can believe that this is a public health crisis AND that this is a financial crisis AND that it’s probably possible for people to exercise responsible social distancing in parks AND that the recent emphasis by public figures to frame reopening the economy as our direst need represents an attempt to effect early exits from social distancing measures in regions that have ZERO business exiting social distancing measures.

And maybe you carry one of those ideas with a bit more weight than another. That’s fine. Because it doesn’t matter. Regardless of what it is that you or I care most about, the best path to fixing it is the same:

  • We must give the health care system the time and breathing room to care for the known and as yet unknown clusters that exist in America;
  • We must take the uncertainty we created through weeks of universal undertesting out of the system;
  • We must give people confidence that there will be an end to quarantines by communicating how that will take place; and
  • We must give markets confidence that the economy will be restarted by communicating how that will take place.

We achieve precisely ZERO of these things by making vague assurances about “reopening America!”

We achieve EACH AND EVERY ONE of these things by developing and communicating a clear plan for how we will use widespread testing to craft a workable American version of the test-and trace approaches that have successfully brought multiple economies in Asia back online.

And we do it NOW.

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Comments

  1. Rusty, I love the way you think. Thank you. I am a self-admitted Pedantic Nerd. I have been trying to figure out why no one has identified the critical path of this crisis. We have enough talent and experience in global disease that we should be able to tell the public what progress and success will look like. We don’t have enough information about the current disease to make projections about when we will hit each milestone, but we can certainly identify and label the milestones. I keep watching Apollo 13 and long for the spirit of Gene Kranz to take the podium. Let’s solve the problem, team. Where is the National / State / Local crisis manager to communicate a comprehensive treatment plan to the public.

    Imagine how markets would react if we heard something along the lines of:
    “First, we’re going to get a reliable, easy to administer test so that we can know where the disease is and how fast it’s spreading. Next, we’re going to implement comprehensive testing protocols so that we get a statistically valid representation of the disease’s trend in each local community. We will continue to test so that we know how the disease is spreading over time. When we see new infections level off and drop to 50% of the peak, we will know that we’re in the recovery phase. While the CDC is working on that, FEMA is going to be working with manufactures, distributors and suppliers to get all the necessary equipment and gear into the medical community so that they have the resources to treat anyone and everyone that needs assistance. HUD will work with facilities to find additional space for patients as the traditional facilities reach capacity. HHS will coordinate with Medicare and Medicaid to ensure that facilities and providers have the funding necessary to remain open and pay their employees. Labor Department will coordinate with local universities and technical schools to train and develop support staff for all of the additional capacity. Congress will work with the Treasury and OMB, with guidance from the Federal Reserve, to develop a targeted economic package to help families and businesses weather the downturn. Please follow the advice and guidance from your local coordinators on what steps you can take to stay safe and help your community. Ladies and Gentlemen, Failure is not an option. We will get through this. As new information is developed, we will share it with you and all of the teams working through this emergency. Thank you for your patience, your assistance, and most of all, your dedication to beating this disease.”

  2. Yes! Exactly this - love it.

  3. Can someone please send this excellent plan to the White House? Now?

  4. Perhaps the term deplorables should have been applied to our civic leaders

  5. I second Rusty’s motion: this is superb. I hope you’ll circulate it as widely as possible ASAP. Thanks.

  6. Avatar for tany tany says:

    I’ve been wondering the same thing TheCoeus, and having led crisis projects before I have some ideas as to what might be happening. Assuming good intention across the board, some likely candidates are:

    1. It’s complex to see what a hurricane is when you’re in the eye of the storm. Everything seems fine, and though you can see and hear the wall of the storm, you cannot yet understand the depth, height or severity of it.
    2. Governing is, unfortunately, distinct from politics. When politicians are faced with a crisis that requires true governing some are simply not up to the task and freeze. They freeze in the same way any leader who is in too deep freezes. They fall back on old processes and systems that worked before and hope that they will work again.

    I think we’ve seen evidence of both of these. The first being Pence’s tepid action since his appointment and the second being Trump’s reflexive attempt to minimize the issue as a hoax and more recently claiming credit for the “extraordinary” and “effective” baring of travel from China (which didn’t actually happen, airlines shut off flights on their own).

    If we extrapolate this set of assertions we can come to an educated guess about what will happen to actually get us through this mess. When leaders freeze in this manner, the competent direct reports at first wait and see, they check the weather as ti were. When they find the temperature to be rising and the crisis intensifying instead of abating, they begin to slowly act separately from their manager in an attempt to do their best to solve the problem in their own bit of the world. As these competent underlings begin to encounter each other and find allies they eventually manage to move the whole project forward despite the manager in charge. My father once described this phenomena as “leading around someone” as opposed to true leadership.

    I suspect that we’re seeing this taking place even today, most publicly in the Coronavirus Task Force meetings. You can see examples of it as Fauci and Birx back each other up against Trump. You can see it as Pence takes the microphone, thanks Trump for his great work, then empowers Fauci and Birx to speak truth with him shielding them from Trump, sometimes physically on the stage. You can see it as the Governors step up and preempt the federal guidelines, opening the state coffers and doing their best to stem the tide as best they can with their meager resources.

    Will this be fast enough? Will it have the quality we hope to see? Probably not. It certainly won’t yield the clear and concise plan you and I are hoping for, but it just might work.

  7. Tany, very good points. You reinforce a lot of the other points that have been made in ET articles. We are no longer in a cooperation game, it’s all competition. There are good people willing to make personal sacrifices for the good of the country, their community, their pack, but they are surrounded and superseded by mediocre people only looking out for themselves. If a nationwide health crisis is not enough to unify the country, what will it take? What level of crisis / calamity will it take for people to come together and strive for the common good? Is it even possible? Hope springs eternal, but like a Midwestern aquifer, mine has slowed to a trickle.

  8. That would require someone there to read it and then adequately communicate it to the higher-ups. I wouldn’t bet on that being the likely outcome.

  9. TheCoeus - I tried to give you +100 but the system said “oops, something went wrong” so please accept the pack’s gratitude for your exceptional plan. It doesn’t show up (yet), but there is a +100 there.

  10. Sadly, after more than three weeks some of this great article could have been written TODAY! They are pushing hard on Reopening America, Round 2 (RAR2) even to the point of stirring up some of the masses. Reference the first two summary bullets at the end…

    1. It could be argued that the healthcare system has been given time and breathing room. How “overbuilding” emergency capacity seems to somehow justify some of the RAR2 people is beyond me since the social distancing has obviously spared many cities from experiencing something similar to NYC. Or Italy, Spain & France. People just didn’t know what was going to happen. Prepare for the worst, hope for the best is often the prudent and right thing to do. Moreover, it is still possible that there will be additional clusters and even full outbreaks in other areas going forward. We don’t know. But at least the processes and care and mechanisms for treating people will be mostly understood.

    2. Testing. Why DPA wasn’t/isn’t being used to martial people and resources required for widespread testing defies logic. Apparently the (critical mass) of responsibility of getting the testing in place has been kicked to the states and private enterprise. The cynic in me says that if this were done then DT’s narrative that we are the best at testing will look as flimsy to everyone as it does to the minority of people who have been following this since January. For example, one could argue that most of the testing in NYC (where most of the testing has occurred) over the last few weeks was in vain and could have, should have been applied to other areas at risk so as to know when to double down on containment. Or possibly even more testing for health care workers across the country. They already knew in NYC that the outbreak was out of control and the results of all that testing wasn’t changing anything. Quarantine was going to continue. People requiring hospitalization would have been admitted anyway (don’t tell me they all got tested after all) and… etc. So the risk remains that the lack of testing in other areas of the country over the last few weeks (used up in NYC to increase numbers on a chart mainly) could come back to bite us. Only the Federal Government could have ramped up and effectively (OK now I see why it didn’t happen) distributed testing so as to best avert large outbreaks. Only time will tell if we do. But that same testing will need to be out there to avert secondary waves. But it appears we are still waiting. It’s probably only a matter of time before we can go to the market and simply buy our own tests. Sign me up.

    Then there is the economic and social fall out from all this. I’m not sure we are even out of the first inning…

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