Water Cooler Observations, May 20, 2020

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By Stephen W. Hiemstra

As I write this morning (5/19/2020), the rate of increase in corona virus deaths in Fairfax County, Virginia and other places has begun to decline. Worldwide rates of increase in daily deaths that were at the end of April in 2 to 5 percent range are now in the 1 to 3 percent range. Calculus students will all remember that a maximum is reached when the rate of increase in change falls to zero. While this pandemic is clearly not over because we still do not have effective tests, treatments, and vaccines, these figures are encouraging.

What’s Changed?

In our family, 2020 is likely to be remembered as the year of the cook. Part of the pleasure of becoming reacquainted as a family has been a new found interesting in cooking shows, cookware, and much better meals. No gap between millennials and boomers has emerged in this trend. We are not only eating better, we are eating more healthy. Who would have thunk that a vegetarian dish could actually be tasty and filling?

Our relationship with technology has obviously changed. While I have participated in at least four Zoom conferences a week, my wife, Maryam, has learned to teach and interact with students online. Virtually every church now has an online service through Facebook, YouTube, or a streaming addition to their website. Many churches now also offer telephone worship for their seniors who are not tech savvy. Now that these skills and investments have been made and proven effective, it is likely that they will remain in service long after the pandemic is behind us.

As an author, I have noticed an increase in book sales. Because I write about Christian spirituality, this trend suggests that people are starting to pay greater attention to faith.

Phases of a Transition

A transition is a period of change consisting of three phases: beginning, middle, and end. In the beginning of a transition, one realizes that things are different but look backwards to the way things used to be. In the middle of a transition, no clear direction is apparent and uncertainty reaches a fever-pitch. In the end of a transition, the end of the tunnel is in sight and one begins to sprint towards it.

In early March we began this pandemic transition practicing a low of panic and believing that this crisis would last only a couple weeks. From mid-March until early May, we found ourselves in the middle phase where uncertainty, denial, and anger were readily obvious. This last week we began what will be a lengthy end phase to this transition.

The end phase is distinguished by the widespread appreciation for the need for testing and the development of vaccines and treatments. It will be a long end phase because appreciation of what needs to be done is constrained by the technical details of actually producing the required tests, vaccines, and treatments.

Innovation

The biblical transition most often discussed is the Exodus of the nation of Israel out of Egypt which was followed by forty years in the desert and entry into the Promised Land. In spite of the drama of the Exodus and the entry, it was the forty years in the desert where the people of Israel discovered their faith in God. In the middle of the transition, with all its uncertainty, we innovate and discover whose we really are.

A persistent question over the past couple weeks has been: how much of the faith and serenity of my grandparents arose because they lived through things like the Spanish flu, two world wars, and the Great Depression? We live in a similar season of trials and temptationswill we learn similar lessons? If so, which ones?

Water Cooler Observations, May 20, 2020

Also see:

Water Cooler Observations, May 13, 2020

Water Cooler Observations, May 6, 2020

Water Cooler Observations, April 29, 2020

Interview about the Corona Life in English and Spanish with Stephen W. Hiemstra, April 24, 2020

Water Cooler Observations, April 22, 2020

Water Cooler Observations, April 15, 2020

Water Cooler Observations, April 8, 2020

Water Cooler Observations, April 1, 2020

Water Cooler Observations, March 25, 2020

Corona Virus Versus the Flu

Black Plague

CDC Flu Statistics

Managing Change 

Believer’s Prayer

Other ways to engage online:

Author site: http://www.StephenWHiemstra.net

Publisher site: http://www.T2Pneuma.com.

Newsletter: https://bit.ly/Release_2020

Continue Reading

Water Cooler Observations, May 13, 2020

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By Stephen W. Hiemstra

The first steps to re-open the economy have begun in many localities. We all recognize that the number of infections and deaths will rise, but the grim reality is that we have no choice. The cost of shutting down the economy fall too heavily on those unable to work from home.

Co-Pays Lower Risk

Christians are not fatalistic. We believe the God works through us and with us to determine our fate (Risk Takers for Christ). What we do with our lives has eternal significance because we are created in the image of a sovereign and powerful God.

A helpful parallel exists in the world of insurance. Being fatalistic implies that nothing we do matters; everything is determined by God. The Islamic expressionif God wills—captures this fatalistic concept. So during the annual Hajj to Mecca, it used to be that accidents, like tent fires, would occur during the Hajj because the tents employed did not include fire extinguishers. True fatalism allows no precautions, like insurance, to mitigate losses because they are the will of God should they occur.

The alternative to fatalism is to allow God’s influence to work through us. The insurance world employs this principle in the case of a co-pay. A co-pay reduces the cost of insurance by recognizing that the insured can affect the probability of a loss occurring by their behavior. The co-pay motivates the insured to take precautions and lower their risk. Fewer accidents occur, which lowers the overall cost of insurance.

The application of the principle of co-pays to the corona virus pandemic is to practice social distancing, use face masks and gloves, and stigmatize anyone that does not not take precautions. The government can help in this process by ticketing offenders and publicizing cases where people sue those that infect them, should the anti-social behavior be egregious. A further step might be to assign liability to those practicing anti-social behaviors.

No Risk-Free Life

There is no such thing as a risk-free life, but some are more prudent than others about their risk taking. An example can be made from the investing world.

A truly risk-adverse person often has trouble making money in investing. If you keep your money in cash or things like savings bonds, it is hard to earn a good rate of return. But how do you learn to invest if you are too risk-adverse? The short answer is that you need to read about investing, practice making investments, and make a few mistakes.

A prudent risk-taker takes small steps to learn about new investment ideas. My rule-of-thumb is to limit new investment ideasrisky ideas—to less than five percent of my portfolio. You will never become rich following my five-percent rule, but you will also never miss out on the opportunities that arise. What works in stock investing also works in career choices.

In a stock market today, fortunes will be made and lost on such principles. I have several friends who lost their retirement savings in the 1990s betting on tech stocks and ignoring my five-percent rule. In the Great Depression, an uncle of mine bet everything on purchasing a section of farmland (one square mile of land) in Northern Iowa and, as a consequence, was able to live comfortably the rest of his life. The bottomline in investing is that you have to take your chances and live with the consequences, both good and bad.

The question of how to re-open the economy is no different. Allowing governors to manage the response of states have shown that not all of them have the same risk-management skills and approaches. Some governors are taking baby steps to re-open while others are betting the farm on an all-or-nothing approach. Germany has taken the former approach while Sweden has taken the laterGermany currently has a 4.4 percent mortality rate while Sweden’s is 12.3 percent.

No one honestly reporting corona virus statistics has a mortality rate of zero.

Water Cooler Observations, May 13, 2020

Also see:

Water Cooler Observations, May 6, 2020

Water Cooler Observations, April 29, 2020

Interview about the Corona Life in English and Spanish with Stephen W. Hiemstra, April 24, 2020

Water Cooler Observations, April 22, 2020

Water Cooler Observations, April 15, 2020

Water Cooler Observations, April 8, 2020

Water Cooler Observations, April 1, 2020

Water Cooler Observations, March 25, 2020

Corona Virus Versus the Flu

Black Plague

CDC Flu Statistics

Managing Change 

Believer’s Prayer

Other ways to engage online:

Author site: http://www.StephenWHiemstra.net

Publisher site: http://www.T2Pneuma.com.

Newsletter: https://bit.ly/Release_2020

 

Continue Reading

Water Cooler Observations, April 29, 2020

Hiemstra_FHFA_02052009

For everything there is a season, and a time for every matter under heaven (Eccl 3:1 ESV).

By Stephen W. Hiemstra

Thinking about the lesson of Ecclesiastes 3 is easy: the best time to take out the garbage is on garbage day! While this seems like a brilliant statement of the obvious, we often respond, not pragmatically, but with denial and, so to speak, try to put garbage out on the wrong days.

My own career as an economist is a case in point. In the 1980s, U.S. agriculture was in crisis and many agricultural banks failed. I had trained as a European analyst, learning French, Spanish, and German, and studying abroad twice during my graduate school years, expertise that was quickly becoming obsolete because of such things like the Internet. Seeing that recruiters wanted financial economists, not European analysts, I went into finance in spite of a lack of specific training and set aside my beloved work in European affairs. This career move was painful, but financially was the best career move that I ever made.

My point? Crises create both problems and opportunities. It’s garbage dayare you willing to take out the garbage?

What Season is It?

Whether or not the politicians open the local economy or not, the corona pandemic is likely to a multiyear event, ending either when we have an effective vaccine or “herd immunity.” Pronouncements to date about a vaccine suggest that a vaccine may be available as early as 2021. Herd immunity will be reached once most of the population gets the corona virus and develop immunity. To date, less than one percent of the U.S. population has been exposed to the virus suggesting a long, uphill battle with this pandemic.

So what do we do in the meantime?

With roughly 26 million Americans out of work, the economic crisis parallels the Great Depression of the 1930s, which lasted about a decade. Social programs (the New Deal) introduced during the 1930s include the minimum wage, social security, various work programs, and encouraging students to complete high school (to keep them out of the workforce). A lot of the monuments and government buildings in Washington DC were constructed during this period. Unfortunately, the government’s best efforts to deal with the crisis did not end the pain. It was World War II that put Americans back to work.

Because of the economic stresses that many people currently feel, I expect that once this pandemic is over many more people will be living in three-generation households. We are smarter and stronger together when we depend on each other. The same is true for our church families.

Now is a Good Time to:

Now is a good time to take stock of your life and career while you have time on your hands. If you are employed and can pay your bills, count your blessings.

Now is a good time to spend time with your friends and family. On Easter Sunday, I visited my parents for the first time in six weeks. We watched their church online, ordered pizza, and held a family Zoom conference. (Check out Zoom.com for a free account). My parents had previous done none of these things so it was fun for all of us. Later, I learned that my parent’s church offers a telephone worship service on Sunday mornings that allows one to call in and listen to the entire service without the need for a computer.

Now is a good time to start an exercise program. Corona virus sickens most people and kills those with pre-existing conditions. Obesity is a contributing factor in many of those pre-existing conditions and it is something that you can do something about. Watch what you eat and take walks with your spouse in the evening. It could reduce your chances of a severe case.

Now is a good time to learn new things. In 2003, when I was between jobs, I visited a seminary for the first time. Feeling God’s call on my life, I began studying Greek (the New Testament was originally written in Greek) and began playing hymns daily.

Now is a good time to begin a new spiritual discipline. Pray when you get up and when you go to bed. Start a journal. Start a bible study. Check out a new church online. Join a small group. People are often surprised when I tell them that I view exercise as a spiritual discipline, but I often pray when I am jogging or swimming laps—it is only time that I am truly alone.

May God bless you during this stressful time.

Water Cooler Observations, April 29, 2020

Also see:

Interview about the Corona Life in English and Spanish with Stephen W. Hiemstra, April 24, 2020

Water Cooler Observations, April 22, 2020

Water Cooler Observations, April 15, 2020

Water Cooler Observations, April 8, 2020

Water Cooler Observations, April 1, 2020

Water Cooler Observations, March 25, 2020

Corona Virus Versus the Flu

Black Plague

CDC Flu Statistics

Managing Change 

Believer’s Prayer

Other ways to engage online:

Author site: http://www.StephenWHiemstra.net

Publisher site: http://www.T2Pneuma.com.

Newsletter: https://bit.ly/Release_2020

Continue Reading

Water Cooler Observations, April 22, 2020

Hiemstra_FHFA_02052009The fear of the LORD is the beginning of knowledge; fools despise wisdom and instruction. (Prov 1:7 ESV)

By Stephen W. Hiemstra

In small group discussions this week, we talked about the nature of wisdom.

One interpretation of wisdom arises through distinguishing different types of knowledge. In my book, Simple Faith (2019), I distinguish three types of knowledge: knowledge about what is (positivistic knowledge), knowledge about values (normative knowledge), and knowledge about what to do (prescriptive knowledge). Prescriptive knowledge is necessarily contextual and often referred to colloquially as wisdom.

In the context of the current corona virus pandemic, we face large and uncertain threats, but also large uncertainty about all three of these types of knowledge. High levels of uncertainty have pushed decisions up the chain of the command in cities, states, and countries, which is the natural response when the delegated authorities of other leaders have been exceeded.

This is clearly a Gethsemane moment, when we have the choice between turning into our pain or turning to God. But, what does turning to God look like? In a similar crisis—the U.S. Civil War—President Lincoln declared a national day of prayer—Thanksgiving. This is an important precedent for the current crisis because in turning to God we admit our inadequacy and turn away from various traps, like political division. Being open to God’s will for our lives is an obvious plea for wisdom, which we sorely lack.

In the secular realm, our current dilemma appears like the classic venture capital problem. Venture capitalists normally operate in an investment context of high uncertainty and, potentially, high rates of return. How does a venture capitalist respond? Set goals and work on figure out what you need to know to achieve them, much like the moon landing in the 1960s using techniques like decision trees and project management approaches.

When President Kennedy announced the objective of putting a man on the moon and returning him safely home again, no one knew how to do it because it had never been done before. I suspect that white boards were brought out, a list of things unknown was identified, and project managers were assigned the task of exploring the unknowns with deadlines for completion.

The Swedish Experiment

In the midst of the corona virus pandemic, the Swedish have apparently decided to continue with business as usual rather than having people shelter in place. This decision was not made out of ignorance, but out of recognition that we do not know the costs involved in alternative strategies.

Social distancing is a policy that evolved out of experience of the Spanish flu in 1918. U.S. cities that practiced social distancing had lower mortality rates than those that did not. In the current crisis, the argument is that by slowing down the transmission of the corona virus, hospitals will be able to treat the victims more adequately because resource constraints on staff and things like ventilators will not be exceeded. Hence, fewer people will die for lack of medical attention.

The Swedish response is to ask whether hospitals are actually able to save more patients than simply having them remain at home.If hospital care does not change actual mortality experience or changes mortality rates only modestly (about two-thirds of patients on ventilators have been reported to die anyway), then the social cost of shutting down the economy may seem to be a drastic measure.

In any case, we really do not know the actual cost of these trade-offs. Is the effect of hospital care simply an example of the placebo effect, where doing anything seems offer improvement that is, in fact, illusionary? We hope that hospital care is a real benefit because in shutting down the U.S. economy we have bet a significant sum to gain this benefit.

Measurement Problem

We really do not know what the mortality rates are from corona virus. Mortality rates currently mask actual mortality rates because deaths are divided into the more difficult cases where tests are administrated. If we tested everyone, we might learn that the mortality rates are actually much lower than reported.

The variance in reported cases suggests extreme uncertainty about mortality rates. In Europe where everyone has social medicine, mortality rates average 10.5 percent. Sweden has a rate of 10.7 percent; in France it is 17.5 percent. In the United States, the mortality rate 5.3 percent on April 18, 2020, exceeding the mortality rate for U.S. Marines (5.2 percent) during World War 2.

The Trade-offs

A meaningful strategy for dealing with the corona virus requires knowledge about three public policy strategies and their cost:

1. Develop herd immunity (the Swedish alternative) without sheltering in place (likely costs the most lives; likely least expensive).

2. Shelter in place until a vaccine becomes available (saves most lives; likely the most expensive).

3. Shelter in place until antibody tests give a green light to come out (unclear how effective in saving lives).

These strategies can be used together. We could, for example, shelter the most vulnerable people while opening the economy, but unfortunately we do not know whether sheltering some is even possible as a practical matter.

The hand-wringing and finger pointing that surrounds conversation about these strategies arises because the Coronavirus Aid, Relief and Economic Security Act (CARES Act) signed on March 27, 2020 and related announcements by the Federal Reserve implicitly assume the corona crisis will end in weeks not months or years. Because a vaccine is likely not going to be available until 2021, and the Spanish flu pandemic in 1918 went on for roughly four years, these alternatives meed to be seriously researched and discussed. Additional public bailouts are simply not financially possible.

The question is: Which strategy is most cost effective in terms of lives and financial resources spared?

Life at Sea

The infection of people on cruise ships and naval vessels gives us a peek at actual mortality rates when everyone is infected.

Aboard the USS Theodore Roosevelt, the U.S. Navy tested 94 percent of the crew, finding 600 sailors (out of 4,800 sailors) infected. Accordingly to Secretary of Defense Mark Esper, 350 of those 600 infected were asymptomatic. As of this writing, the Washington Post reports that only one sailor has died. That yields a mortality rate of less than one percent (0.166 percent = 1/600). Sailors tend to be young and healthy, not a high risk group.

One of the early examples of cruise ship outbreaks in February 2020 resulted in 1,500 infections and 39 deaths (mortality rate of 2.6 percent) in one cruise line, more than any nation other than China at the time. More than two-thirds of the passengers on one such cruise ship were over the age of 65, a healthy strata of high risk group. This compares with media reports of up to half of the corona virus death in the United States being among nursing home residents, a high risk group with pre-existing conditions where mortality rates of around 20 percent have been reported. Still, most corona virus deaths have been of patients who were otherwise living without extraordinary medical intervention.

Summing Up

We all will die. The mortality rate of human beings taken over 120 years is one hundred percent. The question is whether we can live a faithful life between now and then, pointing those around us to God and his salvation in Jesus Christ.

I published my new book, Living in Christ, this week in Kindle on Amazon.com. Once a paperback edition is released within the next couple weeks, I will begin advertising more actively.

Water Cooler Observations, April 22, 2020

Also see:

Water Cooler Observations, April 15, 2020

Water Cooler Observations, April 8, 2020

Water Cooler Observations, April 1, 2020

Water Cooler Observations, March 25, 2020

Corona Virus Versus the Flu

Black Plague

CDC Flu Statistics

Managing Change 

Believer’s Prayer

Other ways to engage online:

Author site: http://www.StephenWHiemstra.net

Publisher site: http://www.T2Pneuma.com.

Newsletter: https://bit.ly/Meet_2020

Continue Reading