October was a tough month for the markets. They started out strong but rolled over on rising medical risks. Fortunately, the impact was cushioned by better economic news.

Today, I'd like to provide an update on the coronavirus, including the economic and market implications. On the medical front, the third wave of the pandemic has accelerated around the country. With new cases at all-time highs and the geographic spread continuing to widen, this is something we need to watch.

Once again, the medical news worsened since the last update, as the third wave of infections has continued to accelerate around the country. Case growth is now at new highs, above the prior peaks in July, while the geographic spread of this wave of outbreaks continues to widen. Case growth in many states is now at levels that threaten the health care systems there, indicating this is a growing problem.

Today, we have another down day in the markets, as the pandemic continues to worsen. So, is it time to worry about the markets again? Let’s take a closer look.

We are in the midst of a rising third wave of the pandemic, as well as facing multiple other issues (the election, the wildfires, and so on). But the economy continues to move forward. Consumer confidence is steady, personal spending is doing well, and business confidence and investment are strong. Even after the initial fiscal and unemployment support, the economy has continued to expand despite rising medical risks. Given all this, maybe it is time to take another look at where the risks are and whether they are as big as has been commonly assumed.

Last week was relatively quiet on the economic update front, with a major focus on the housing market. Home builder sentiment and new home construction continued to show solid growth, supported by low mortgage rates and strong sales. This week will be jam-packed with updates touching on wide swaths of the economy.

We have had a roller-coaster ride in 2020 so far, and the rest of the year looks to be no easier—and probably just as hard. The election is coming up, the third wave of the virus is underway, large parts of the country are on fire, and a record-setting hurricane season is in progress. And that’s just in the U.S. Looking abroad, at least two things—Brexit and the U.S.-China trade war—would be making bigger headlines here in any other year. There is a lot to pay attention to, a lot to worry about, and a lot that could go wrong. With everything in play, we need to remember to do something critical.

The medical news has continued to worsen since the last update, to the point that a third wave of infections is now underway around the country. Case growth has accelerated and is approaching the July peaks, while the geographic spread of this wave of outbreaks continues to widen. Case growth in many states is nearing levels that could threaten the health care systems there, indicating this is a growing problem.

"When the facts change, I change my mind.” This is a famous quote from John Maynard Keynes, which is followed by the sardonic question, “What do you do, sir?” Very wise and, of course, very witty. It’s not, however, necessarily useful.

Last week, I wrote that I was not worried about the deficit and the debt—at least in the short to medium term. We appear to have lots of running room before the debt is an immediate problem, which could be years (or more) away. While acknowledging it as a problem, looking at history and around the world, there are no real reasons it has to be an immediate problem.