Why one Florida city wants to build a two-mile tunnel to the beach

Local leaders are in talks with Elon Musk’s The Boring Company to build a two-mile tunnel underground from downtown to the beach and offer rides for between $5-8. Miami also appears to be considering using Musk’s company to dig a tunnel and divert car traffic from crowded surface streets. Mayor Francis Suarez said last month that Musk had told him a local project, previously priced at $1 billion, could be done for closer to $30 million, and finished in six months.Then earlier this month he reported having a productive meeting with The Boring Company regarding “groundbreaking improvements” to transportation. Suarez has spoken of building a “signature project” for the world with the Boring Company. Projects could be done for about 1% of typical tunneling costs, according to estimates leaders say they’ve received from Musk’s Boring Company.Florida has only two tunnel projects in the whole state, but Musk appears to have convinced state leaders to embrace them. Tunnels are generally considered an infrastructure choice of last resort, according to Brian Gettinger, who leads tunneling at the infrastructure company Freese and Nichols.”You see them where nothing else works because they’re generally more expensive,” Gettinger said. Tunneling technology has progressed significantly in the last generation, he said. Pressure is applied at the face of the new tunnel, preventing water and earth from flooding the excavation site. This has made tunneling viable in more places, according to Gettinger.But Florida’s dry land — and the lack thereof — brings unique challenges for tunnel builders.Florida’s limestone can make it harder to optimize a tunneling machine because there are natural holes in it, Gettinger said. Tunnel builders prefer when rock is solid, he said. It’s easy to customize a machine for consistent conditions, like solid rock or soil. Climate change also adds risk for tunnels, due to sea levels rising and tunnels potentially flooding. In Mayalsia, Gettinger said, tunnels have been specifically designed to manage flooding. Florida has high levels of groundwater and gets more rainfall than most states. Some of Florida’s limestone include underground aquifers, which need to be protected given potential impacts on groundwater, according to Greg Raines, global tunnel practice leader at Stantec. Sinkholes and settlement will also need to be controlled for in Florida, Raines said.These kinds of complications could impact tunneling costs. Florida’s unique challenges would make it very difficult to estimate tunneling costs, Raines said. The Port of Miami tunnels, which is nearly a mile, cost $1.1 billion and took four years to build. Tunneling costs worldwide have ranged from $175 million per mile to $3.5 billion per mile, Raines said. The Florida mayors declined to say if they would insist on any provisions in a contract related to cost overruns. The Boring Company did not respond to requests for comment for this story.But the risks haven’t deterred Florida’s leaders, who see additional places tunnels might help.The Boring Company, which has yet to open a public project, will still have to prove it can deliver on the huge price drop. Musk has led breakthroughs at Tesla and SpaceX, but he’s also made a habit of missing deadlines and falling short of his projections.Florida leaders are excited, and point to Musk’s successes. They aren’t expressing worry that the Boring Company could struggle with some of the unique challenges of tunneling in Florida. “I see this as a revolutionary opportunity to rethink transportation in South Florida and other regions around the country,” Fort Lauderdale Mayor Dean Trantalis told CNN Business.The mayor declined to reveal if the government would subsidize tickets, akin to public transportation, or if operating revenue would go to the government, or the Boring Company. A spokesperson said that discussions so far are preliminary.Trantalis said that growing train traffic in his city risks worsening vehicle and ship traffic as they compete for space. He had wanted to build a tunnel for trains under a stretch of the city, but had been told by state officials that it was too expensive. But then Trantalis said he saw a recent Twitter exchange between Musk and Miami Mayor Francis Suarez, which inspired him to reach out to the Boring Company.The train tunnel would need to be 24 feet in diameter, twice the size of The Boring Company’s existing tunnels. The wider a tunnel is, the more it costs to dig. Trantalis said he expects they’ll start on a simpler project, the two-mile tunnel to the beach. Fort Lauderdale and the Boring Company are currently studying the local geology to determine what path to take, Trantalis said. A contract hasn’t been signed yet, he said.Trantalis said meeting the Boring Company has opened the city’s eyes to other opportunities, like using a tunnel network to alleviate on-street traffic.The Boring Company offers a system it calls Loop, in which people can ride in Teslas around a city in underground tunnels. Loop has also drawn criticism from transportation planners, who say it makes inefficient use of tunnels. The Boring Company’s first Loop system in Las Vegas is expected to open this summer.Trantalis said the initial tunnel to the beach could carry hundreds of people per day. For comparison, that would mean it carries fewer riders than about half of Broward County Transit’s bus lines, which operate in Fort Lauderdale.Gettinger, one of the tunneling experts, believes tunnels in US cities will become increasingly common as populations in big cities grow. The more expensive land is, the more it makes sense to utilize every square foot, whether for a train tunnel, car tunnel or sewage tunnel, he said. No matter what comes next, Musk may not be using the tunnels much himself to visit Florida’s beaches. He’s said he only enjoys going to the beach for a few days. “The idea of like lying on a beach as my main thing just sounds like the worst, that sounds horrible to me,” he said in a 2013 interview. “I’d be super duper bored.”

Israel’s COVID-19 Vaccination Rollout Is Slowing at a Critical Moment. That’s a Warning for the Rest of Us

Now that nearly 60% of Israel’s roughly 9 million residents have gotten at least one shot of a COVID-19 vaccine, the New Jersey-sized Middle Eastern country is offering the rest of the world an enviable glimpse of a future where most people are inoculated against the coronavirus. While it’s still too early to tell the full extent to which vaccination is having an effect there, Israel’s rate of virus-related deaths has dropped faster than global figures since it started vaccinating (see chart below and methodology at bottom). Meanwhile, the latest real-world evidence collected in Israel suggests the Pfizer-BioNTech vaccine—the country’s most commonly administered shot—is preventing nearly 99% of deaths from COVID-19, while also curbing viral spread.

Israel’s mass vaccination efforts got off to an impressive start, with more than 10% of the population receiving their first dose fewer than two weeks into the national vaccination campaign. By comparison, it took the U.S. 57 days to reach the same mark, the U.K. 45 days, and the European Union still hasn’t matched it. Today, Israel is the worldwide leader in vaccinations per capita, at 108 doses administered for every 100 people, per the New York Times (the Pfizer vaccine requires two doses). But Israel’s breakneck rollout is beginning to slow, according to data from the Israeli Ministry of Health. While the country was administering first doses to as much as 1.5% of its population every day in early January, it’s now distributing fewer than 0.2% of initial doses daily.

That’s a problem, as Israel remains short of the 70% mark that public health experts say is the minimum required level for mass vaccination to turn the tide against the pandemic in a given country.

A closer look at the data reveals that not everyone in Israel has benefited equally from the vaccine rollout. Only 67% of Arab-Israelis and 70% of Israeli Haredi Jews (a group sometimes referred to as “ultra-Orthodox” Jews) over 16 were vaccinated or had recovered from COVID-19 as of March 4, compared to 90% of the rest of the population, according to data shared by Weizmann Institute computational biologist Eran Segal. However, Israel has recently had success targeting older—and thus more vulnerable—members of those communities. By March 4, 84% of Arab-Israelis and about 80% of Haredi Israelis over 50 were vaccinated, up from 68% and 72% respectively on Feb. 22, according to Segal’s data. Aside from being the right thing to do on moral grounds, better vaccinating these groups could push Israel over the critical nationwide 70% mark. To achieve that goal, Israeli public health officials have been working to address two major problems: vaccine hesitancy among these and other groups, and a failure to reach some residents who live in remote areas with less access to vaccination facilities and trustworthy information. Its efforts could be instructive for the U.S., which is also struggling with comparatively lower vaccination rates among some demographic groups, and for similar reasons. The Centers for Disease Control and Prevention only has race and ethnicity data for just over half of the vaccinations administered in the U.S. as of March 15, but of those shots, nearly two thirds have gone to white Americans, while less than 10% have gone to Hispanic or Black Americans, who make up 18.5% and 13.4% of the U.S. population, respectively.

In Israel, some groups are more vaccine hesitant or skeptical than others. A January survey from the Social Policy Institute at Washington University in St. Louis found that 51% of yet-unvaccinated Arab-Israelis and 42% of Israeli Haredi Jews weren’t planning to get the shot, for instance, compared to just 34% of those who identified as either secular, cultural, or Reform Jews. There’s a similar phenomenon occurring in the U.S., where 42% of Republicans, 35% of rural residents and 35% of Black Americans said in December that they probably or definitely will not get the vaccine, compared to just 27% of the general public, per the Kaiser Family Foundation. Only 29% of Israelis overall say they trust the government, while 25% of Arab-Israelis say the same, according to the 2020 Israeli Democracy Index. Some Arab-Israelis have been angered by discrimination and hostility towards their community, as well as by Israel’s treatment of the Palestinian territories like the West Bank and Gaza, where vaccinations have barely begun. Some Haredi Israelis, meanwhile, feel their culture and belief system is incompatible with what they view as Israel’s secular mainstream society, and many trust religious leaders over secular authorities. During the COVID-19 outbreak, Haredi groups have butted heads with government officials over lockdowns and restrictions; some have gathered for holidays and funerals despite restrictions against large groups. In an August poll, more than half of Israeli Haredim said their community’s trust in the current government was shaken amid the pandemic. All of this is relevant to the vaccine rollout, experts say, because people who distrust the government for any reason may be less likely to listen when it pushes a vaccine. “Sometimes, politics really goes against the interest of public health,” says Hadas Ziv, head of projects and ethics for medical nonprofit Physicians for Human Rights Israel. Arab-Israelis, Haredi Israelis and other Israelis have also been exposed to anti-vaccination messaging and misinformation on social media platforms like WhatsApp and via word of mouth. Some of the U.S. groups expressing relatively high vaccine hesitancy are similarly distrustful of the government—just 9% of Black Americans told Pew in 2019 that they trust Washington all or most of the time, compared to 17% of white Americans, for instance. Former U.S. President Donald Trump’s politicization of the virus and vaccine approval sowed further skepticism, experts say—after Trump promised a vaccine by last year’s Election Day, about 62% of Americans told Kaiser that they were worried a shot would be green-lit for political reasons before it was proven safe and effective. Moreover, inadequate access to care and longstanding mistreatment by medical institutions has contributed to distrust of healthcare providers among Black Americans and other non-white groups. Misinformation about COVID-19 vaccines, meanwhile, runs rampant on American social media networks, as it does in Israeli online communities. While vaccine hesitancy has been dropping in recent weeks, according to a TIME/Harris Poll conducted earlier this month, it remains a major issue for U.S. health officials.

To help solve the credibility issue, Israeli public health officials have turned to trusted voices in communities with low uptake. This approach “turns the gaze of the community to the experts to the local expert—and then the local expert does the persuasion,” says Saad Omer, director of the Yale Institute for Global Health. In December, Aida Touma-Sliman, an Arab-Israeli member of Israel’s national legislature, tweeted a picture of herself being vaccinated to encourage other Arab-Israelis to do the same. “As someone who is very well known as part of the opposition, saying that in this situation, do not follow your mistrust of the government, but follow the best interest of your health—it sounds more like something to believe, than coming from Netanyahu: that despite my opposition, I am telling you, you should do it,” she says, referencing Israeli Prime Minister Benjamin Netanyahu. Yitzchak Zilberstein, a prominent ultra-Orthodox rabbi, shared a similar message with his community in December. “The risk of the vaccine is minimal compared to the many risks of the corona epidemic,” he wrote. Prominent Americans from Michelle Obama to Dolly Parton have similarly shared photos of themselves getting the vaccine in recent days. Access is also emerging as an increasingly vital issue in Israel. Many of the country’s 9 million people live in urban centers, like Jerusalem and Tel Aviv; it’s been relatively easy for people there to walk into a vaccination site and get the jab. However, it’s been more challenging for the country to vaccinate people in historically underserved areas and communities, which are often largely Arab. “You can’t have places to get it in every tiny village,” says Orna Baron-Epel, a professor of health promotion at the University of Haifa. Similar patterns are playing out in the U.S., where access is suppressing vaccination rates in many predominantly Black neighborhoods, for instance. Israel has recently been working to make the vaccine easier to get across the country. Aiman Saif, a former government official who’s been tapped to lead Israel’s COVID-19 response among Arab groups, told Jewish-American news outlet The Forward in February that Israel boosted the number of vaccination locations in Arab-majority areas from five or six to over 50, while also adding 30 buses as mobile vaccination stations. Leaders in Israeli Orthodox communities have organized vaccination drives and seminars at religious schools and other locations to boost uptake as well. In the U.S., health systems and local governments have deployed mobile vaccination clinics in rural areas and high density, low-income areas, and the Biden Administration has spearheaded efforts to distribute vaccines at community health centers serving low-income and minority patients.

Although Israel has shown that a lot can be done to reduce vaccine hesitancy and improve access, public health outreach to each of these groups must make up for decades of lost trust. While Israel has been making inroads in vaccinating some of the most vulnerable members of underserved groups, critics say leaders there were too slow to address these often predictable problems. Baron-Epel, for one, fears the government failed to invest enough resources in Arab communities earlier on, in particular. “The ideas are good, what they’re doing is good,” she says. “But it’s not enough, you know, and not fast enough.” The key lesson from Israel for the U.S. and other countries, then, may be a challenging one: hesitancy and access need to be addressed well before they become stumbling blocks late in the vaccine rollout. Methodology note: The number of COVID-19 deaths in Israel peaked on Jan. 25 at 0.74 fatalities per 100,000 residents, compared to a global peak of 0.18 one day later, according to data from the Johns Hopkins Center for Systems Science and Engineering. While Israel’s peak value was much higher than the global average, its death rate has declined at a much steeper rate since the peak, though it’s too soon to know to what degree this can be attributed to vaccinations. For the sake of comparison, the first chart above presents both Israeli and global deaths as a percentage of the peak value—what’s called “normalizing” the data—so they can be easily compared. —With reporting by Chris Wilson

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The Ratings Game: Don’t expect people to use stimulus money to buy GameStop stock, analyst says

Investors expecting GameStop Inc.’s stock to get a boost as the latest government stimulus payments hit bank accounts will likely be disappointed, according to BofA Securities analyst Curtis Nagle. Nagle wrote in a research note Friday that in collaboration with BofA’s predictive analytics group, he analyzed the potential impact on GameStop’s stock
GME,
-5.33%
from the $1,400 stimulus payments that are currently being made.

By looking at online forums such as Reddit, Nagle said previous sharp increases in the number of conversations involving stimulus and GameStop (GME) appeared to coincide with big stock price gains. But going forward, Nagle, who is bearish on GameStop shares, said he believes any positive effect from the “stimmies” has already been played out. “[W]e believe the impact going forward may be limited given two factors,” Nagle wrote in a note to clients. • “Conversations [sic] involving stimulus appear to have peaked and GME shares declined over the past few days.” • “The number of recent conversations including both GME and stimulus is low.”

BofA Global Research, ListenFirst

Nagle also pointed out that GME trading volumes have also steadily declined and short interest has fallen “materially.” Nagle reiterated his underperform rating on the stock, and his price target of $10. Trading volume has averaged 34.5 million shares per day in March through Thursday, after averaging 43.6 million shares per day in February and 66.4 million shares in January, according to a MarketWatch analysis of FactSet data.

FactSet, MarketWatch

And the latest available exchange data showed that short interest as a percentage of the public float was 26.1%, compared with over 100% when the Reddit-induced trading frenzy started in mid-January. GameStop’s stock dropped 6.7% in morning trading, and have tumbled 29.1% this week. That puts the stock on track to snap a three-week win streak in which it rocketed 551.6%, which followed a three-week losing streak in which it plummeted 87.5%. Don’t miss: Robinhood business model under fire at GameStop hearing in Congress. Also read: The most frequently asked questions by Robinhood traders reveal ‘new type of uninformed equity-market participant.’ Rather than buying stocks, it looks increasingly likely that the current $1,400 stimulus payouts, and other disposable moneys, will be spent elsewhere. Read more: Student loans, charity and pet bills — here’s what readers way they will do with their $1,400 stimulus checks. “While we have not surveyed consumers on how much they intend to invest in the stock market going forward, in our latest Home Work survey, respondents plan to increase spending most over the next 12 months on activities that were restricted by COVID-19, including vacations, restaurants and travel, as well as home investing and decorating,” Nagle wrote. Despite this week’s pullback, GameStop shares are still up 1,105.0% over the past three months, while the S&P 500 index
SPX,
-0.18%
has edged up 5.4%.

Need to Know: The bond market is ‘useless’ predicting inflation, and stocks look even more expensive than they appear, strategist says

The question still reverberating in financial markets is to what degree the $1.9 trillion coronavirus relief will be spent, either immediately or if the virus recedes enough for shoppers to be allowed, and wanting, to go out. This column previously pointed to surveys of both how the initial $600 stimulus was used, and plans for the $1,400 that has arrived for many households, to suggest much of it won’t be deployed into the economy.

Another way to look at it is if households perceive the stimulus to be additional income or additional wealth. Studies have shown that the propensity to spend out of wealth is just 5%, while the propensity to spend out of income ranges from 10% to 50%, according to a recent speech from Gertjan Vlieghe, a voting member of the Bank of England’s Monetary Policy Committee. Dhaval Joshi, chief strategist at BCA Research, says whether the new stimulus is considered wealth or income depends on whether the household receiving it has a low or high income to begin with. But looking at past stimulus checks, there weren’t meaningful shifts in either consumption or inflation.

Accordingly, he thinks market expectations about inflation are getting carried away. He also says — in a note written before Thursday’s plunge in crude-oil prices
CL.1,
+0.95%
— that inflation expectations are positively correlated with high commodity prices, even though actual inflation tends to drop when commodity prices are high. “Given that the bond market
TMUBMUSD10Y,
1.728%
is useless at predicting inflation, it is also useless at assessing real interest rates,” he says. If the bond market is exaggerating the future level of inflation, than the correct inflation-adjusted bond yield should be even higher. “The important takeaway right now is that in any comparison with the real bond yield, equities and other risk-assets are even more expensive than they appear.” Bitcoin flows mirror stock flows

Is bitcoin
BTCUSD,
+2.22%
a diversifier? It is a huge debate in markets, that several major banks have taken on in just the last two weeks. Sven Henrich, the technical analyst who runs the Northman Trader website, produced this chart, showing that correlation between the weekly flows into bitcoin and stocks is at the highest level ever. Random reads The tulip craze in the 1600s is often cited by financial market analysts when discussing speculative manias. For irony lovers, there are nonfungible tulips — that is, illustrations of tulips sold on the blockchain — for sale. A shark with wings? Scientists puzzled over fossil found in Mexico. Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern. Want more for the day ahead? Sign up for The Barron’s Daily, a morning briefing for investors, including exclusive commentary from Barron’s and MarketWatch writers.