Singapore-based financial blog that aims to educate people on personal finance, investments, retirement and their Central Provident Fund (CPF) matters.

Monday, 4 May 2020

Death Rate for COVID-19 Could Be Higher Than The Reported Number


In March, newspapers were reporting that the global death rate for COVID-19 is about 2%.
Today, as of current 3rd May 2020 at 9 pm, that figure has risen to 7.0%.
Although most people still seem to be stuck with the notion that death rates below 10% are not a concern.
We are going to explain why rates are probably higher than 10% and why you should be concerned.

The Data
As of current 3rd May 2020, 9 pm, these are the COVID-19 cases worldwide.
Source from Worldometers.

Total Cases: 3,506,077
       Active Cases: 2,131,171
               Mild Condition:        2,080,561
               Critical Condition:   50,610
       Closed Cases: 1,374,906
               Recovered Cases:     1,129,713
               Death Cases:            245,193

The Misconception
Death Rate: Death Cases / Total Cases = 7.0%
The Death Rate is the deaths-to-infection ratio.
But to the everyday men and women, Death Rate is being misunderstood as 'the probability of me dying if I contracted COVID-19', which is technically incorrect.
Let me explain why.

Suppose a death rate of 7% means that the probability of me dying if I have COVID-19 is 7%.
If there is a death rate, then there must be a "Recovery Rate," which would be 'Recovered Cases / Total Cases.'
That means that COVID-19 has a "Recovery Rate" of 32.2%.
So, if I contracted COVID-19, I have a 7% chance of dying, a 32.2% chance of recovery, then where does the remaining 60.8% go?
60.8% is the total number of Active Cases, which means if I contracted COVID-19, I got a 60.8% chance of permanently lying on the hospital bed?
Don't make sense, right?

Recommended Read: The 4% Shortfall In Your CPF Retirement Fund

Introducing Schrödinger's cat
Source: Pixabay

What's a Schrödinger's cat?
It is an experiment that originated from Albert Einstein and devised by Erwin Schrödinger.
The idea is if you put a cat and a bowl of poison inside a box that you cannot see inside.
There are now 2 outcomes created:

  1. The cat did not eat the poison and is still alive
  2. The cat ate the poison and died.

Either of the 2 outcomes may have happened, but you would not know until you lift the box to see what happened inside.
The cat is, in a sense, both "dead and alive."

What Does This Have To Do With COVID-19?
If someone contracted COVID-19, that person is technically the Schrödinger's cat now.
The person could die from COVID-19 or recover from it.
But we would not know which outcome the person would end up in until we 'open the box', or in this situation until the case is closed.

Case Fatality Rate (CFR) = Death Cases / Closed Cases
Out of the 1,374,906 closed cases, 17.8% of them were deaths (CFR = 17.8%).
What this means is that it is very much possible that someone who contracts COVID-19 has a 17.8% chance of dying.
If percentage-wise seems too foreign, let me convert it into human numbers: for every 6 confirmed cases, 1 will die.
Of course, the other way to look at it is that one has an 82.2% chance of recovering from it.
The Good News
Wait; what? There's good news?
Well, kind of?
In April, the CFR averaged 21% and started dropping to 17.8% during the last week of April.
The CFR could continue to drop, but it could also rise again.
SARS had a CFR of 11%, MERS had a CFR of 34.4%, COVID-19 could be anywhere in between.

So the best thing we can do is to stay at home, practice good hygiene, and grumble less.
And if you could and would like to help in this pandemic, please donate what you can to SGUnited.
If you have a neighbour you know struggling to make ends it, please donate to them the extra toilet paper, instant noodles, and can food you are keeping in the storeroom 😉.

Recommended Read: Save in CPF or Invest in SPDR STI ETF?

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