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Our briefing for Friday, January 14, 2022:
Jan 14, 2022 3:37:19 PM
- In the United States, President Joe Biden announced on Thursday the deployment of military medics to six hard-hit states, as the nation battles an Omicron surge. The federal government will also send double the number of at-home rapid tests to be distributed for free, and plans to make high quality N95 masks available to all in the near future. According to the Centers for Disease Control and Prevention, the U.S. is seeing a weekly average of more than 750,000 cases per day, an increase of 47% from the previous week. The military support will help at-capacity emergency rooms and overwhelmed hospital staff in Michigan, New York, New Jersey, Ohio, New Mexico, and Rhode Island.
- Health Canada is poised to make a decision regarding the authorization of Pfizer’s antiviral Covid-19 treatment in the next seven to 10 days. In the U.S., where the drug was approved just before Christmas, supply issues have made it hard for anyone to get access, which raises even more questions as to when the drug might be available to Canadians. Pfizer applied to the United States Food and Drug administration on November 22 and to Health Canada on December 1, but health officials have said the Canadian submission was incomplete, with more data coming in at the end of December and earlier this week. As a result, the decision will take at least another week to 10 days for Canada.
- In the United Kingdom, Professor Jonathan Van-Tam is leaving his role as England’s deputy chief medical officer to take up a new role at the University of Nottingham. Professor Van-Tam, who worked on the Covid-19 pandemic and Vaccine Taskforce, became widely known for his use of football analogies to explain complex scientific concepts during coronavirus briefings. In a statement, he described his time as deputy chief medical officer as “the greatest privilege” but “the most challenging of my professional career,’” adding “we all wish Covid had never happened.” Professor Van-Tam was recently knighted, along with Chief Medical Officer Professor Chris Witty.
- Germany’s vaccine committee has recommended that children between the ages of 12 and 17 should receive their booster shots. The move makes Germany one of the first countries in the world to do so, following the United States, Israel and Hungary. The committee said the booster should be from Pfizer/BioNTech and given at least three months after the child has had their second shot. "The current situation, with a sharp increase in the number of cases due to the Omicron variant and the feared consequences for the health system in Germany, makes it necessary to extend the vaccination campaign," said the vaccine committee in a statement. The European Medicines Agency has still not given their regulatory approval, so Germany will be responsible for any liabilities linked to the booster for the age group.
- In Japan, case numbers have topped 18,000, about 5000 more than the previous day’s number, while the nation’s capital reported 3124 new coronavirus cases, the most since September 1. According to projections announced at a municipal government meeting, the daily tally for Tokyo is expected to exceed 10,000 by the end of January. On Sunday Japan tightened restrictions in three regions that host U.S. military bases after concerns were raised that outbreaks at the bases have spilled over into local communities. Tokyo’s governor has said she will request similar measures if the region’s hospitals come under pressure.
- In Australia, it looks like hospitalizations will plateau next week in the nation’s most populous state of New South Wales. The state’s health deputy secretary Susan Pearce said pressure will likely remain on hospitals for the next few weeks, even though hospitalization numbers are tracking better than the best-case scenario from an official modelling a week ago. "That is pleasing, but that plateauing is obviously still at a relatively high level of Covid patients in our hospitals and in our (intensive care)," Pearce told a media briefing. Of Australia’s nearly 1.4 million Covid-19 cases, about 1.2 million of them have been reported in the last four weeks.
Covid-19 – Due Diligence And Asset Management
Why a wide-scale return to the office is a myth
Brief: For two years, employees have been waiting for ‘the day’ when everyone goes back to the office. But it’s probably never coming. Workers were meant to have returned to the office by now. Our expectation, back in early 2020, was that once the pandemic had ended, we’d all collectively resume our pre-Covid patterns of office-based working. Yet that’s not how things have turned out. Two years on, employees around the world continue to face ongoing uncertainty as to when – and if – they’ll be expected back at the workplace in person. The emergence of different Covid-19 variants has exacerbated matters; Omicron has triggered record cases globally, forcing employees who were slowly adapting to a partial, hybrid return to the office to reverse course and work remotely again. Today, the idea that we’ll all return to the office together again seems highly unrealistic.
Alternative assets to reach USD23.21tn in 2026, says Preqin report
Brief: Alternative assets fund managers, who are currently holding more than USD13 trillion in assets under management (AUM) — continuing the year-on-year growth since 2010 — are expected to hold USD23.21 trillion by the end of 2026, according to Preqin’s 2022 Global Alternatives Reports. Private equity & venture capital (PEVC) is by far the largest asset class, with AUM estimated to be in excess of USD11 trillion as of December 2026, accounting for almost half (49 per cent) of alternative assets AUM. Private debt is expected to be the fastest-growing alternative asset class over the next five years – with a compound annual growth rate (CAGR) of 17.4 per cent, taking AUM to an estimated USD2.69 trillion by the end of 2026 – as institutional investors continue to look for reliable income streams. Environmental, social, and governance (ESG) factors have become increasingly important among alternative assets, in particular for infrastructure and natural resources.
UK economy finally bigger than before pandemic in November
Brief: Britain's economy grew strongly in November to finally surpass its size just before the country went into its first COVID-19 lockdown, official data showed on Friday. The world's fifth-biggest economy expanded by a much faster than expected 0.9% in November - before the latest wave of COVID-19 infections and restrictions for many firms - leaving it 0.7% bigger than it was in February 2020, the ONS said.Economists polled by Reuters had forecast monthly gross domestic product growth of 0.4% for November."It's amazing to see the size of the economy back to pre-pandemic levels in November – a testament to the grit and determination of the British people," finance minister Rishi Sunak said. Other economies have already recovered their pre-COVID size, chief among them the United States.
Why Omicron is a bigger market risk in 2022 than people think
Brief: U.S. markets have largely shaken off Omicron fears, witnessed by the pop in cruise line stocks Thursday despite a general market sell-off. But surging COVID-19 infections in China, beyond the early pandemic peak, are leading one strategist to warn of an underpriced risk to inflation that could weigh on stocks. At a recent Yahoo Finance Plus webinar, Bianco Research President Jim Bianco argued that China's zero tolerance COVID policy could lead to a nationwide shutdown — causing economic reverberations around the world. "What I'm most worried about here is as this Omicron variant mushrooms, and we get millions of cases a day, it's not necessarily a health risk. But what it is is that anybody who tests positive can't go to work for 10 days, and we've got huge absenteeism. And that's really coming home in China in a big way, because China has a zero COVID policy. They lock everybody down, and lock you in your house for weeks on end until COVID goes away," said Bianco.
Regulation ‘huge structural risk’ for investors
Brief: Regulation is one of the most underrated and important risks for investors to consider this year. This is the view of M&G chief investment officer, equities Fabiana Fedeli who was speaking at a roundtable hosted by the fund manager this morning (13 January 2022). While Covid-19, inflation, and policy errors are concerns, Fedeli warned that risks around regulation should not be neglected. She said: “Covid, inflation and policy errors are clear risks, but regulation is a huge structural risk. “Governments are looking more and more into companies. They’re looking at the consumer from a different perspective. “In the US, there might be regulation at some point in the IT sector. It comes from a complete shift in the way the regulator thinks about how the consumer benefits.
