Charting a Coronavirus Infection

By Katherine J. Wu and Jonathan Corum

After months of downplaying the threat of the Covid-19 pandemic, President Trump announced early Friday morning that he and the first lady, Melania Trump, had tested positive for the coronavirus. 

He has been hospitalized at the Walter Reed National Military Medical Center and has experienced mild to moderate symptoms, including a fever, cough and congestion. He also reportedly had low blood oxygen levels at least twice on Friday and Saturday.

It’s too soon to tell whether his illness will follow a typical course, or how severe his symptoms may become. And with millions of people sickened worldwide, no single timeline can encompass the range of Covid cases. But months of data have helped scientists home in on the general portrait of a symptomatic coronavirus case.

Exposure and Incubation

The time between initial exposure to the virus and the appearance of symptoms is known as the incubation period. This period is typically four to five days, although it can last up to 14 days, or perhaps even longer in rare cases.

It remains unclear who infected Mr. Trump, although there are many potential candidates, several of whom gathered with the president during White House event for Judge Amy Coney Barrett on Sept. 26 or have traveled with him to crowded campaign rallies.

Symptoms and Recovery

Most people who come down with Covid recover within a couple of weeks and do not require hospitalization. Severe cases, however, may take far longer to resolve. And a growing cohort of coronavirus survivors, called long-haulers, has reported symptoms and side effects — including fatigue, impaired memory and heart problems — that can linger for months.

People who develop severe cases of Covid tend to be hospitalized within two weeks or so of the emergence of symptoms. But many of the factors that catapult certain people toward severe forms of the disease remain a scientific mystery. 

Scientists know that people who are male, older and obese — all descriptors of President Trump — are at higher risk for more serious effects of Covid.

Viral Load

After an initial exposure, the number of virus particles in a person’s body, or viral load, takes time to build up as the pathogen infiltrates cells and copies itself repeatedly. 

Mathematical models indicate that the viral load tends to peak before symptoms appear, if they appear at all, and starts to decline rather quickly in the days following the first signs of illness.

Experts have said that people are more likely to be contagious when their viral loads are high. If so, the window of peak infectiousness might be only a few days long, beginning a day or two before symptoms appear, and closing within a week thereafter.

This also means that people can be highly contagious during the so-called presymptomatic stage, in the days before they develop symptoms. 

Separately, asymptomatic carriers of the coronavirus have also been repeatedly pinpointed as the source of transmission events, although how the virus behaves in the bodies of such people is less understood.

If Mr. Trump’s symptoms appeared on Wednesday or Thursday, he may have exposed several people in the days prior. 

He most likely remains contagious now. In a series of tweets early Friday morning, the president confirmed that he and Mrs. Trump would isolate themselves — a move that swiftly canceled several events in the tense lead-up to the Nov. 3 election. 

Later, Mr. Trump was taken to Walter Reed for a stay of several days. He has been given an experimental antibody treatment developed by the drug maker Regeneron, an antiviral drug called remdesivir and the steroid dexamethasone.

Testing for the Virus

For months, the White House has screened people coming into close contact with Mr. Trump. Many of these screenings are rapid tests, delivering actionable results within minutes without needing to send samples to a laboratory. 

Such speed and convenience can come at the cost of accuracy: Rapid tests are worse at picking up on low viral loads and very recent infections, and more often produce false negatives or false positives. 

Some experts argue that true positives from rapid tests might coincide with the period in which people are most contagious, although this has not yet been confirmed.

Rapid tests like the much-discussed Abbott ID Now and BinaxNOW have been given an emergency F.D.A. green light only for sick people who are within seven days of the start of symptoms. 

Use on individuals who don’t feel ill is considered off-label, and negative results from such tests can’t rule out an infection or contagiousness.

People with known exposure to an infected person — like Mr. Trump — or who have already developed symptoms may need to take a more sensitive test. 

Experts often recommend laboratory tests that rely on a technique called P.C.R. (polymerase chain reaction) that can detect very small amounts of the virus, but that usually takes several hours to run on sophisticated, expensive machines.

Because a P.C.R. test is more sensitive to low viral loads, it may be able to detect a coronavirus infection very early on. 

But the diagnostic test can also pick up harmless bits of the virus that linger in the body after symptoms have resolved, and perhaps after a person stops being contagious.

Antibodies are produced by the body in response to an invading pathogen, starting about a week or so into an infection, and can persist in the blood for months. Another type of test, called a serology test, looks for these antibodies instead of the virus. Experts do not consider antibody tests to be a reliable way to determine whether a person is harboring the coronavirus.

Preventing Infection

Because the virus can be transmitted by people who feel healthy, experts have stressed the importance of deploying multiple public health measures to combat its spread. While no single tactic can confer complete protection, combining actions like mask-wearing, physical distancing, handwashing and avoiding crowded spaces rapidly ratchets down risk.

Masks and face coverings that swaddle the nose and mouth can block much of transmission, and seem especially effective at waylaying outbound virus from an infected individual. But there’s evidence that masks can thwart some percentage of inbound pathogens as well, even if they don’t make the wearer impervious to infection.

Mr. Trump has repeatedly shirked masks for much of the pandemic. On Tuesday night during the debate, he mocked former Vice President Joseph R. Biden Jr. for his stringent commitment to face coverings and physical distancing.

Infected people can also reduce the chance of passing on the virus by isolating themselves for at least 10 days after symptoms appear, as long as they continue to improve. 

Those who have been exposed to someone with a known case of the coronavirus should quarantine for two weeks and seek a test. Up to 40 percent of infections might lack symptoms, although some estimates have been even higher.

Based on data gleaned from other respiratory viruses, researchers think there is likely to be a minimum infectious dose for the coronavirus, or the lowest number of virus particles necessary to establish an infection. That number most likely varies from person to person, and there is not yet firm data on what a typical dose might be.

The Centers for Disease Control and Prevention note that people with Covid are unlikely to be infectious for more than 10 to 20 days after their symptoms start.

Argentina bondholders accuse government of undermining recovery

Rebuke comes as bond prices are mired in distressed territory just months after restructuring deal

Colby Smith in New York and Benedict Mander in Buenos Aires

       Bondholders were critical of policies implemented by the government of Alberto Fernández, Argentina’s president © Argentinian Presidency/AFP via G

Some of Argentina’s biggest bondholders issued a sharp rebuke of how the government is handling the country’s deteriorating economic situation, just a few months after reaching a compromise to restructure $65bn worth of debt. 

Two creditor groups at the heart of the recent negotiations to resolve Argentina’s unsustainable debt burden accused the government of putting forward policies that “undermine” its own economic recovery, in a statement released on Thursday.

They also called into question whether “their sacrifices to provide a debt structure Argentina is capable of servicing were essentially meaningless”.

“Argentina’s economic authorities have not only failed to restore confidence, but policy actions taken in the immediate aftermath of the debt restructuring have dramatically worsened the country’s economic crisis,” wrote members of the group, representing holders of previously restructured exchange bonds as well as the Argentina creditor committee.

They added: “Instead of heralding a reopening of access to markets to support Argentina’s manifest investment needs, the aftermath of the debt restructuring is a virtual wasteland for Argentine credit.”

Argentine bond prices have sunk back into distressed territory since the restructuring process was finalised in early September. The deal involved Argentina pushing back the timing of large debt payments and slashing the aggregate amount set to be paid out to creditors.

The country’s bond set to mature in 2030 has slipped to 38 cents on the dollar, having debuted above 50. Another approximately $20bn in bonds maturing in 2035 have since plunged to 34 cents on the dollar.

Meanwhile, the peso has slumped after already-strict capital controls were tightened last month. So far government measures aimed at protecting net liquid foreign exchange reserves, which have fallen below $1bn, have failed to convince investors, as the central bank continues to resort to massive money printing to finance spending.

The gap between the official and black market exchange rates has reached historic highs, with many fearing that the country’s seventh devaluation since Argentina’s peso abandoned its peg to the dollar in 2002 is imminent. On the black market a dollar can now fetch as much as 190 pesos. 

The statement from creditors came on the heels of the IMF’s most recent visit to Buenos Aires earlier this month. The fund lent Argentina $44bn as part of a record $57bn bailout package extended in 2018, and policymakers are now looking to renegotiate the repayment plans.

“This vicious cycle needs to be broken,” the investors said. “Creditors have already played their part, providing a historic opportunity to Argentina for a fresh start. It is now up to Argentina and the IMF to play theirs.” 

The Next Civil War?

Although US President Donald Trump has long hid his tax records and history of business failings, he has never made any secret of his willingness to destroy the US constitutional order if doing so will give him a political advantage. Not since the eve of the Civil War has America been so on edge.

Elizabeth Drew

WASHINGTON, DC – America’s capital is more on edge now than at perhaps any other time since the eve of the Civil War in 1860. The city was tense during Watergate, of course. 

But as much as Richard Nixon tested the constitutional system, as a lawyer who had served in government for decades, he recognized that there are limits that even a president dares not transgress. 

And now, with President Donald Trump, the First Lady, and a top aide all testing positive for COVID-19, there is more uncertainty in Washington, DC that at any time in living memory.

The non-medical crisis now facing the United States is that Trump doesn’t recognize limits. There is scant indication that he even understands, let alone respects, America’s constitutional order, the survival of which depends on whether those to whom power has been entrusted exercise restraint.

Trump, recklessly breaking precedents and norms, has consistently attempted to disable any checks on his behavior. He insists that Article II of the Constitution “gives me the right to do whatever I want to do.” And he is buttressed in his view by Attorney General William Barr, who is the kind of fealty-first law-enforcement chief that Trump has craved.

A critical part of Trump’s effort to undermine confidence in the election outcome, if it goes against him, is his attempt to discredit millions of ballots preemptively. The assumption is that, because of the COVID-19 pandemic that Trump has allowed to get out of hand, more Americans than ever before will vote by mail, and that most of those who do will be Democrats.

Earlier, misreading public opinion as he so often does, Trump sought to slow mail deliveries in order to disqualify millions of mail-in ballots. After a public backlash, these activities were supposedly suspended, yet mail delivery remains slower than before.

Then, in September, Trump started saying that the election aftermath will be peaceful as long as “we … get rid of the ballots” – whatever that means. He and his campaign team are now casting about for more ways to shape or otherwise invalidate the election’s outcome if necessary.

Allies of Trump’s challenger Joe Biden are discussing how to forestall Republican meddling with the outcome, and force the president from the White House if he loses the election but refuses to leave. The need to take this astonishing possibility seriously is a sign of how far things have deteriorated.

And so, the legal guns are being readied. With luck, real weapons won’t be used. But Trump has been encouraging violence since he first ran for office, and he doesn’t convincingly eschew it now. His calling at the first presidential debate on the Proud Boys, a violent right-wing white-supremacy group, to “stand back and stand by” has embroiled the White House in efforts to sanitize this ominous statement.

Meanwhile, the New York Times’ recent  exposé has made clear why Trump has frantically sought to keep his tax returns secret: he paid $750 in federal income taxes in both 2016 and 2017, and nothing for many years before that. The revelations about Trump’s dicey tax record and business dealings offers one explanation for his desperation to win another term in office. 

The Times’ reporting has scraped away Trump’s populist façade and revealed that the underlying rationale for his presidency – that he was a savvy billionaire who would apply his amazing business acumen to running the country – was entirely bogus.

The Times report also showed that, as was widely suspected, Trump had received financial help from authoritarian countries such as Turkey and Saudi Arabia. And Trump reportedly has voiced his own assumption that he has benefited from Russian oligarchs at the behest of Vladimir Putin. 

Numerous observers warn that Trump’s indebtedness to foreign countries makes him a national-security threat. As it is, Trump owes over $400 million in debts that will come due in the next few years; there’s no knowing where he’ll find the money.

Trump’s performance in the first presidential debate was the latest demonstration of the threat he poses to democracy. His thuggish behavior – serial interruptions, nasty wisecracks, and blatant distortions – were an extension of his persistent effort to destroy any means of holding him accountable. 

The debates are another democratic practice that Trump seeks to destroy. But despite all the lamentations over what a miserable event the debate was, the tens of millions of Americans who loathe him should celebrate his performance, displaying as it did the unvarnished Trump.

The so-called debate didn’t ease Trump’s political predicament. He can scarcely afford to lose support at this point. His unwillingness to denounce white supremacists unambiguously, his apparent incitement of violence, and his threats – “This is not going to end well” – were as alarming as they were norm-shattering. Even some of Trump’s Senate Republican lackeys openly expressed unease.

Though Biden provided some substance and obviously didn’t stoop to Trump’s level, he wasn’t at his best. He occasionally appeared thrown off by Trump’s behavior, and failed to convey the stature and sense of command that people desire in a president. By calling Trump a “clown” and telling him to “shut up,” Biden may have been trying to show that he, too, can play a tough guy. But is this how Americans want a president to talk?

Some semblance of a coherent argument could be glimpsed in Trump’s attempt to ram through the Republican-controlled Senate the nomination of the right-wing judge Amy Coney Barrett to fill the Supreme Court seat vacated by the death of the liberal hero Ruth Bader Ginsburg. 

By trying to have her confirmed and seated in a few weeks, Trump is again going against democratic assumptions, and also public opinion. Trump openly states that he wants Barrett on the bench to improve his chances if a case involving the election outcome reaches the Court. Republican senators seem unwilling to insist that Barrett recuse herself to avoid such a flagrant conflict of interest.

Trump’s disinclination – and perhaps inability – to reach beyond his right-wing base, which is insufficient to elect him, also calls into question his political acumen, and is one of many reasons to doubt his basic intelligence (an issue on which he is quite sensitive). But one thing about the president is now clearer than ever: in order to perpetuate his hold on power, Trump is testing the constitution in unprecedented ways.

Elizabeth Drew is a Washington-based journalist and the author, most recently, of Washington Journal: Reporting Watergate and Richard Nixon's Downfall.

Spain Becomes Europe’s Weak Link

The Spanish economy is suffering from a particularly bad resurgence in Covid-19 cases as well as its outsized exposure to tourism

By Jon Sindreu

Once a rising star of the European economy, Spain is on a path to becoming its problem child—and the latest example of why global investors should tread carefully around Southern European stocks.

This week, the latest readings of the purchasing managers index published by IHS Markit confirmed two trends. The first is that global manufacturing activity is recovering at a much faster pace than services. The second is that, among big developed countries, Spain seems to be in particular trouble.

The pandemic has made these polls of companies more difficult to interpret than usual. Still, they show Spain performing worse than its European peers, including Italy, which was the economic laggard coming into the crisis and was worse hit by the first wave of Covid-19 cases.

Spain has been unable to contain the spread of the virus. 

In the spring, officials took too long to act, only to later establish the strictest of lockdowns. 

Unlike Italy, the country then tried to return to normal too fast—its leader of health emergencies went abroad on vacation just weeks after advising against travel between provinces. 

Infection rates rebounded sharply in the summer, such that Spain accounted for one-third of Europe’s daily Covid-19 cases. Now, Madrid is one of the region’s hardest-hit cities, and new measures that directly impact the services sector have been enacted.

The structure of Spain’s economy, which enjoyed a growth spurt between 2015 and 2019, explains why it is at risk now. 

Tourism directly accounts for 12% of Spanish gross domestic product—more than any other member of the Organization for Economic Cooperation and Development—and employs 14% of the population.

Official figures suggest that half of the one million jobs lost during the depths of the outbreak have already been recovered. But there are an additional 735,000 being propped up by subsidized furlough programs. 

Many are tourism-related roles that will probably disappear as soon as support ceases. 

The real unemployment rate is likely well above 20%, rather than the official 15%.

In the medium term, what is even more important for all economies is how much money consumers have once the pandemic is over. Reduced earnings could depress demand for years and even cause a double-dip recession. 

In the U.S., an expansion of unemployment subsidies and stimulus checks led personal income to increase more than 10% in the second quarter even as people lost their jobs. In Southern Europe and Spain in particular, by contrast, income losses have been very steep, Oxford Economics analyst Ángel Talavera has pointed out.

The reason is that these governments have been less willing or able to widen their budget deficits by opening their purses, despite support from the European Central Bank. While Oxford Economics forecasts a rebound in Spanish personal income in the third quarter, the economic gap with richer nations is likely to widen from here. 

European reconstruction funds will probably arrive too late—over the past week, governance questions have put the timing further at risk—and won’t fix Spain’s overreliance on relatively unproductive industries like tourism.

A big question for investors over the past few months has been whether to tilt their portfolios from the U.S. to Europe. The pain in Spain is a warning of the dangers involved.

The end of the dollar’s exorbitant privilege

A crash is likely given the collapse in US domestic saving and a gaping current account deficit

Stephen Roach 


The riddle once posed in the 1960s by former French finance minister (eventually president) Valéry Giscard d’Estaing is about to be solved. Giscard bemoaned a US that took advantage of its privileged position as the world’s dominant reserve currency and drew freely on the rest of the world to support its over-extended standard of living. 

That privilege is about to be withdrawn. A crash in the dollar is likely and it could fall by as much as 35 per cent by the end of 2021.

The reason: a lethal interplay between a collapse in domestic saving and a gaping current account deficit. In the second quarter of 2020, net domestic saving — depreciation-adjusted saving of households, businesses and the government sector — plunged back into negative territory for the first time since the global financial crisis. 

At -1.2 per cent in the second quarter, net domestic saving as a share of national income was fully 4.1 percentage points below the first quarter, the steepest quarterly plunge in records that go back to 1947. 

 Unsurprisingly, the current account deficit followed suit. Lacking in saving and wanting to grow, the US levered its exorbitant privilege to borrow surplus saving from abroad. 

That pushed the current account deficit to -3.5 per cent of gross domestic product in the second quarter — 1.4 percentage points below that in the first period and also the sharpest quarterly erosion on record.

While a Covid-related explosion in the federal government deficit is the immediate source of the problem, this was an accident waiting to happen. 

Going into the pandemic, the net domestic saving rate averaged just 2.9 per cent of gross national income from 2011 to 2019, less than half the 7 per cent average from 1960 to 2005. 

This thin cushion left the US vulnerable to any shock, let alone Covid.

As budget deficits pile up in the years ahead, further downward pressure on domestic saving and the current account will intensify. 

The latest estimates of the Congressional Budget Office put the federal deficit at 16 per cent of gross domestic product in 2020 before receding to “just” 8.6 per cent in 2021. 

Assuming the US Congress eventually agrees to another round of fiscal relief, a much larger deficit for 2021 is likely.

This will take the US net saving rate far deeper into negative territory than during the global crisis That has ominous implications for America’s future. 

After setting aside depreciation required of an ageing capital stock of buildings and infrastructure, the US is, in effect, liquidating the net saving required for the expansion of productive capacity. 

Without borrowing surplus saving from abroad, growth becomes impossible. 

The current account deficit will only deepen as a result.

That’s when the dollar loses its special privilege. With America’s position as the world’s dominant reserve currency slowly eroding since 2000, foreign lenders are likely to demand concessions on the terms for such massive external financing. This normally takes two forms — an interest rate and/or a currency adjustment. 

The Federal Reserve has recently shifted to a strategy that takes into account an average of inflation rather than a specific target, and promised to keep policy rates near zero for several more years. 

That means the interest rate channel has effectively been closed. As a result, more of the current account adjustment will now be forced through a weaker dollar.

The US dollar’s lofty value makes it especially vulnerable. Despite recent falls, a broad index of the dollar’s real effective exchange rate remains some 27 per cent above its July 2011 low. 

That leaves the greenback as the world’s most overvalued major currency, just as the US gets sucked into an unprecedented savings-current account vortex.

Currencies are relative prices. The dollar has always benefited from the seductive charm of TINA — that there is no alternative. Think again. 

The July 21 agreement on a Next Generation EU Fund of €750bn ($858bn) finally establishes a pan-European fiscal policy. That should boost the undervalued euro. The renminbi, gold and cryptocurrencies are also alternatives to the once invincible dollar.

The dollar index fell 33 per cent in real terms both in the 1970s and the mid-1980s, and another 28 per cent from 2002 to 2011. 

During those three periods, the net domestic saving rate averaged 4.9 per cent (versus -1.2 per cent today) and the current account deficit was -2.5 per cent of gross domestic product (versus -3.5 per cent today). 

With the US having squandered its exorbitant privilege, the dollar is now far more vulnerable to a sharp correction. A crash is looming.