Month: November 2021

Elizabeth Warren’s War on Accounting

Mary Pat Campbell

Link:https://www.wsj.com/articles/elizabeth-warren-accounting-standards-corporate-minimum-tax-fasb-reconciliation-taxation-11636921275

Excerpt:

The Democrats’ proposed 15% levy on the world-wide financial-accounting earnings of large, highly profitable companies may sound familiar. It was originally proposed by Sen. Elizabeth Warren during her bid for president. Democrats are pushing this tax again now, hoping it will encourage passage of a $1.85 billion reconciliation bill to fund President Biden’s Build Back Better plan.

Any plan to tax financial-accounting earnings is ill-conceived, as I argued on these pages in May 2019. Blurring the lines between taxable income and financial-accounting profit would inevitably lead to political meddling in financial-accounting rules and damage the usefulness of financial accounting for investors.

…..

Politicians and the FASB have vastly different objectives. Financial-accounting rules are created by the apolitical FASB to provide information useful to investors. In contrast, tax-accounting rules are largely determined by Congress to achieve such objectives as raising revenue, encouraging or discouraging certain behavior, and redistributing wealth. Two accounting systems are necessary, one for pursuing social objectives through the tax system, the other for giving investors comparable, reliable and timely information. The U.S. is not unique in this regard. Every developed country has a tax-accounting system that is separate from its financial-accounting system.

Because the objectives of the two systems are different, the income they compute is different. 

…..

If Congress wants to raise more revenue and prevent companies from reporting low tax rates, it should change the tax code. 

Author(s): Scott Dyreng

Publication Date: 14 Nov 2021

Publication Site: Wall Street Journal

Flu rips through University of Michigan campus, bringing CDC to Ann Arbor

Mary Pat Campbell

Link:https://www.freep.com/story/news/health/2021/11/15/flu-rips-through-university-michigan-campus-brings-cdc-campus/8622063002/

Excerpt:

Influenza is sweeping the University of Michigan’s Ann Arbor campus, with 528 cases diagnosed at the University Health Service since Oct. 6.  

The outbreak is so sudden and large — 313 cases were identified the week of Nov. 8 alone and 37% of flu tests that week were positive — that it’s drawn the attention of federal health leaders.

……

Among those who’ve contracted flu at U-M this fall, 77% didn’t get a flu vaccine. The cases were identified as influenza A (H3N2), said Lindsey Mortenson, UHS medical director and acting executive director.

“While we often start to see some flu activity now, the size of this outbreak is unusual,” said Juan Luis Marquez, medical director at the Washtenaw County Health Department. “We’re grateful for the additional support of the CDC and our ongoing partnership with the university as we look more closely at the situation.”

Author(s): Kristen Jordan Shamus

Publication Date: 15 Nov 2021

Publication Site: Detroit Free Press

Predictable country-level bias in the reporting of COVID-19 deaths

Mary Pat Campbell

Link:https://www.sciencedirect.com/science/article/pii/S2667319321000124

Graphic:

Abstract:

We examine whether a country’s management of the COVID-19 pandemic relate to the downward biasing of the number of reported deaths from COVID-19. Using deviations from historical averages of the total number of monthly deaths within a country, we find that the probability of underreporting of COVID-related deaths for countries with the most stringent policies was 58.6%, compared to a 28.2% for countries with the least stringent policies. Countries with the lowest ex ante healthcare capacity in terms of number of available beds underreport deaths by 52.5% on average, compared to 23.1% for countries with the greatest capacity.

https://doi.org/10.1016/j.jge.2021.100012

Author(s): Botir Kobilov, Ethan Rouen, George Serafeim

Publication Date: Summer 2021

Publication Site: Journal of Government and Economics

COVID-19: Eight Dead, 89 Infected In Outbreak At Connecticut Nursing Home

Mary Pat Campbell

Link:https://dailyvoice.com/new-york/northsalem/news/covid-19-eight-dead-89-infected-in-outbreak-at-connecticut-nursing-home/819985/

Excerpt:

Eight residents of a Connecticut nursing home have died during a COVID-19 outbreak that has lasted nearly six weeks.

A total of 89 employees and residents have tested positive since the outbreak began at the Geer Nursing and Rehabilitation Center, located in Litchfield County, in the Town of Canaan, on Thursday, Sept. 30.

“Despite seeing significant numbers of residents recovering from Covid,” the facility’s chief executive Kevin O’Connell and nursing director Cady Bloodgood said in a statement. “testing has resulted in one additional positive case among fully vaccinated residents and staff members. Sadly, we have lost eight residents with serious underlying health issues to Covid.”

Author(s): Joe Lombardi

Publication Date: 14 Nov 2021

Publication Site: Daily Voice

November 14-20, 1921

Mary Pat Campbell

Link: https://roaring20s.substack.com/p/november-14-1921

Graphic:

Excerpt:

Historical Fact: Some readers may have a pressing question: What happens to debt, including mortgages, under hyperinflation? In finance, there is a popular quote, “there is no free lunch.” By 1924, Weimar Germany will redenominate and reinstate debt into the brand new Rentenmark after bailing out Deutsche Bank and Commerzbank. It’s a messy process and beyond the scope of this publication you’re reading.

Author(s): Tate

Publication Date: 14 Nov 2021

Publication Site: Roaring 20s at substack

Why COVID-19 Probably Killed More People Than We Realize

Mary Pat Campbell

Link:https://hbswk.hbs.edu/item/why-covid-19-probably-killed-more-people-than-we-realize

Graphic:

Excerpt:

As the number of casualties from COVID-19 ballooned at an alarming rate last year, some feared that government officials were failing to report several coronavirus-related losses and the actual death toll was much higher worldwide.

While the official count shows more than 5 million people have died of the disease, a new study of underreported casualties in several countries indicates that COVID has actually killed hundreds of thousands more people than government records document.

….

The HBS researchers gathered the reported monthly numbers of deaths during the pandemic in each of the 51 countries from a variety of sources, including reports in the New York Times and the European Commission’s database, Eurostat. They compared that data to figures from the same months for the past three to five years to calculate excess deaths. Subtracting the number of official COVID deaths for each country helped them gauge potential underreporting.

…..

In fact, countries with more stringent policies in place did, on average, have 59 percent higher unexplained excess deaths—that is, 159 deaths for every 100 reported for COVID.

Author(s): Ethan Rouen, George Serafeim

Publication Date: 2 Nov 2021

Publication Site: Working Knowledge at Harvard Business School

Year-to-Date Murder Comparisons

Mary Pat Campbell

Link:https://datastudio.google.com/embed/u/0/reporting/133bc335-b4e9-41f4-890d-3adb7de5a141/page/QX9NC

Graphic:

Excerpt:

Murder rose by roughly 25 percent in 2020 according to preliminary data from the FBI. The graph on the right shows why analyzing data from big cities is the best way we have to understand current murder trends. These figures will be updated throughout the year, and data later in the year will give a much clearer picture of our anticipated murder trend compared to data collected early in the year. 

Date Accessed: 11 Nov 2021

Publication Site: Datalytics

Practical Application of “Do Jumps Matter in the Long Term? A Tale of Two Horizons”

Mary Pat Campbell

Link:https://www.soa.org/globalassets/assets/files/resources/naaj-practical-application-essays/2021/naaj-essay-cantor.pdf

Graphic:

Excerpt:

In this essay, we consider an additional application. Using the utility framework described by Warren (2019), we
examine the impact of using one of BB’s fitted jump-diffusion models on a pension plan sponsor’s long-term asset
allocation decision. We want to compare asset allocation results to those using the standard finance workhorse
model of a geometric Brownian motion (i.e., lognormal return generating process or LN hereafter).

Author(s):

Jean-François Bégin, PhD, FSA, FCIA
Mathieu Boudreault, PhD, FSA, FCIA
David R. Cantor, CFA, FRM, ASA
Kailan Shang, FSA, ACIA, CFA, PRM

Publication Date: September 2021

Publication Site: Society of Actuaries

Wave of COVID-19 Deaths Hit RGA Hard

Mary Pat Campbell

Link: https://www.thinkadvisor.com/2021/11/08/wave-of-covid-19-deaths-hit-rga-hard/

Excerpt:

After the second quarter, RGA executives told analysts they were optimistic about the effects of COVID-19 vaccination programs on mortality.

Instead, “the third quarter saw increases in both COVID-19 and non-COVID-19 general population mortality,” Porter said.

In the United States and India, the typical age of people dying of COVID-19 is falling, Porter added.

That hurts life insurers because people under 65 are more likely than older people to have life insurance.

Author(s): Allison Bell

Publication Date: 8 Nov 2021

Publication Site: Think Advisor

November 7-13, 1921

Mary Pat Campbell

Link:https://roaring20s.substack.com/p/november-7-1921

Graphic:

Excerpt:

Companies ranging from Ford Motor Company to Union Pacific Railroad report substantially improved business activity for the month of October. The current recession may have ended in the summer. Aggregate bond purchases were the largest since one year ago as Americans finally start investing again. Opinion articles, however, advise against common stock and its gambling attributes.

Historical Fact: American and international investors will soon assume high GDP growth is a feature of the American economy, as God-given and laid down in the natural order as the seasons. At the end of 1921, however, it’s not yet clear elements are present for business revival.

Author(s): Tate

Publication Date: 7 Nov 2021

Publication Site: Roaring 20s on substack

An Unsolved Mystery: Why Do More Men Die of Covid-19?

Mary Pat Campbell

Link:https://www.nytimes.com/2021/11/02/opinion/men-covid-19-deaths.html

Excerpt:

Men are much more likely than women to die of Covid-19 and are more likely to be intubated and have long hospitalizations. This disparity in Covid-related deaths has existed since early in the pandemic, before there were any vaccines. Men are also more likely to develop certain rare complications from some Covid-19 vaccines and to experience a faster decline in measures of immunity once vaccinated. The reasons remain unclear.

Historically, women have been largely excluded from medical studies, and health issues that predominantly affect women have been underresearched. This is both morally wrong and medically foolish because it limits physicians’ ability to deliver optimal care. Rather than ignore sex differences in Covid-19 outcomes, scientists should pay attention to them to better understand the disease and how to treat it.

Data from the Centers for Disease Control and Prevention shows that in the United States, women account for 45.6 percent of Covid-19 deaths so far and men account for 54.4 percent. (Men make up slightly less than half the U.S. population.) Among Americans ages 65 to 84 — the group at highest risk for severe Covid-19 — the gap is even larger: 57.9 percent of deaths have occurred among men and 42.1 percent among women. According to the Brookings Institution, at least 65,000 more men than women have died of Covid-19 in the United States. Globally, the death rate has been about 50 percent higher for men.

A July 2021 study found that compared to women, men with Covid-19 had an almost 50 percent higher rate of respiratory intubation and a 22 percent longer hospital stay.

Author(s): Ezekiel Emanuel

Publication Date: 2 Nov 2021

Publication Site: New York Times

On Covid, Excess Mortality by Race/Ethnicity, and Geographic Patterns

Mary Pat Campbell

Link:https://marypatcampbell.substack.com/p/on-covid-excess-mortality-by-raceethnicity

Graphic:

Video:

Excerpt:

And now you can see it — the blue curve for Hispanics has a summer 2020 peak much higher than that for whites, Blacks, and Asians.

I want to note the high peak for Asian deaths in winter 2020-2021.

See that there is a high spike for Asian, Hispanic, and Black in that first NYC-centered wave that we’ve known so well… but a little blip for White. And I want you to think about that a little. Because that really explains a lot of the disproportionate effects on minorities in the U.S. and it goes back to Charles Blow’s question at the top of this post.

The answer to all of this being geographic distribution.

Author(s): Mary Pat Campbell

Publication Date: 6 Nov 2021

Publication Site: STUMP at substack