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Our briefing for Friday, March 18, 2022:
Mar 18, 2022 1:52:25 PM
- In the United States, the Biden administration’s COVID-19 team will be undergoing a change as COVID-19 coordinator Jeff Zients and his deputy Natalie Quillian are leaving the administration next month. The White House announced on Thursday Dr. Ashish Jha, the dean of the Brown University School of Public Health will serve as their replacement. The Associated Press notes the changeover comes as the Biden administration has come under criticism for confusing public messages around the virus as many restrictions and mandates are easing. Therefore, it is not surprising the White House’s statement highlighted Dr. Jha’s communication skills and familiarity to Americans as he has been a fixture on cable news outlets during the pandemic.
- Canada’s population grew by nearly half a million in 2021, closer to the record population growth the country was experiencing pre-pandemic. According to Statistics Canada, the number of people living in the country rose 1.2% or 457,888, to 38.5 million in 2021. The number is up from 2020 when the COVID-19 pandemic first took hold, when the population only increased by 160,273 people. Most of the population gain came from international migration as the Canadian federal government eased most travel restrictions for those coming to the country for work, school, or family reunification – with the numbers increasing to four times as many as compared to 2020.
- In the United Kingdom, a cross-section of parliamentary MPs have said the Coronavirus Act was passed in an “unsatisfactory” manner. The Guardian reported ministers failed to allow parliament enough of an opportunity to scrutinize the 329-page Coronavirus Act of 2020 as sweeping laws were passed to tackle the COVID-19 pandemic. “It is unsatisfactory that since the Coronavirus Act was passed, in just three sitting days in March 2020, parliament has been unable to substantively debate its provisions as was promised during its passage,” said the committee chair, William Wragg. The committee points to the two-year “sunset clause” to the bill and if it was right approach attaching “stronger and broader powers” than they might otherwise not have been willing to accept.
- In South Korea, government officials are trying to calm public fears that the coronavirus pandemic response is faltering. On Thursday it was reported there were 429 deaths due to COVID-19 in the last 24 hours, nearly 140 more than the previous record set on Tuesday. The 621,266 coronavirus cases registered on Thursday also shattered the previous high of 400,624 set on Wednesday. The outbreak has been significantly larger than what had been forecast by government officials, who maintain the Omicron variant is nearing its peak. However, even though South Korea set a record for COVID-19 deaths, it has a much lower death rate, in relation to population size, than the United States or many European nations, which officials attribute high vaccination rates as more than 68% of the South Korean population have received booster shots.
- Japan’s government have formally decided to lift all remaining coronavirus emergency curbs as scheduled, starting next week. Tokyo is one of 18 other areas expected to see restrictions end on Monday March 21st. When the Omicron variant was making its way through Japan earlier in the year, 36 prefectures were subject to some kind of coronavirus related restriction. When the measures are lifted it will be the first time since January 8th, Japan has been free of such measures, but Prime Minister Fumio Kishida said there will still be a transition period where Japanese citizens should continue to take maximum caution against spread of infection.
- The World Health Organization (WHO) have stated the evaluation of Russia’s Sputnik V coronavirus vaccine has been postponed due to the country’s ongoing war in Ukraine. A WHO vaccine expert had stated the United Nations’ health agency was originally scheduled to visit Russia on March 7th to assess the facilities where Sputnik V is produced, but due to the war that inspection had been postponed for a later date. The WHO has been evaluating Russia’s Sputnik V vaccine since last year and its authorization would allow the Russian-made vaccine to be purchased as part of the UN-backed COVAX effort to distribute vaccines worldwide and would lend creditability to the jab that some other countries have been slow to take up.
Covid-19 – Due Diligence And Asset Management
Ukraine War Hits World Economy Like an Earthquake, IMF Head says
Brief: The war in Ukraine is like a powerful earthquake that will have ripple effects throughout the global economy, especially in poor countries, according to the head of the International Monetary Fund. The conflict will lead to lower growth and faster inflation worldwide, Managing Director Kristalina Georgieva said Friday on an IMF panel about the lender’s strategy to support fragile and conflict-affected nations. Countries, businesses and households will face more serious debt problems after a jump in borrowing during the first year of the pandemic, she said. Ukraine and Russia together account for more than a quarter of the global trade in wheat, and a fifth of corn sales. The longer Russian forces remain in Ukraine, the longer tractors and combines to harvest the nation’s crops stay idle, threatening food security far beyond the region, Georgieva said. “We would have some very significant problems that would be particularly difficult for fragile states,” Georgieva said. The world tends to focus on “front-page issues, and not on this second- and third-order-of-impact consequences,” she said.
Fed Governor Waller says half-point rate hikes could be needed as ‘inflation is raging’
Brief: Federal Reserve Governor Christopher Waller told CNBC on Friday that the central bank may need to enact one or more 50-basis-point interest rate hikes this year to tame inflation. Though he voted this week for just a 25-basis-point move due to uncertainty from the Russian invasion of Ukraine, Waller said he thinks the Fed may need to be more aggressive soon. “I really favor front-loading our rate hikes, that we need to do more withdrawal of accommodation now if we want to have an impact on inflation later this year and next year,” he told CNBC’s Steve Liesman during a live “Squawk Box” interview. “So in that sense, the way to front-load it is to pull some rate hikes forward, which would imply 50 basis points at one or multiple meetings in the near future.” In addition to the rate hikes, Waller said he thinks the Fed needs to start reducing its bond holdings soon. The central bank balance sheet has ballooned to just over $9 trillion, and officials are preparing the process to start rolling off some of their holdings. Waller said that process should start “in the next meeting or two.” “We’re in a different place than we were before,” he said. “We have a much bigger balance sheet, the economy’s in a much different position. Inflation is raging. So, we’re in a position where we could actually draw down a large amount of liquidity out of the system without really doing much damage.”
American private equity firm Sycamore has designs on fashion chain Ted Baker
Brief: An American private equity firm is weighing a potential takeover bid for Ted Baker, the British fashion chain. Sky News has learnt that Sycamore Partners is working with advisers to examine a potential offer for the London-listed company. Sycamore specialises in investments in the retail sector, having previously owned brands such as the upmarket footwear label Kurt Geiger. This week, it was linked with a $9bn takeover bid for Kohl's, the US department store chain. It was also reported to be among the suitors circling Boots, Britain's biggest chain of high street chemists, although City insiders have expressed scepticism about Sycamore's eventual involvement in the auction.
50% of companies want workers back in office 5 days a week-why experts say this strategy could fail
Brief: After two years of working from home – and seeing return-to-office plans derailed by new Covid-19 variants – a growing number of companies are eager to get employees back to the office. About 50% of leaders say their company already requires or is planning to require employees to return to in-person work full-time in the next year, according to new research fromMicrosoft, which surveyed 31,102 workers around the world between January and February. This number stands in sharp contrast, however, to what employees really want:flexibility. In the same report, 52% of workers said that they are thinking of switching to a full-time remote or hybrid job in 2022. “A lot of business leaders have told me that they don’t believe in hybrid work, that it has no place in their culture,” Elise Freedman, a workforce transformation practice leader at Korn Ferry who is helping companies coordinate their return-to-office plans, tellsCNBC Make It.
Hedge Fund Manager Pierre Andurand Sees a Path to $200 Oil By End of the Year
Brief: Commodities trader Pierre Andurand sees a path for crude oil to get to $200 by the end of the year as historically tight markets struggle to ramp up production and replace lost supply from Russia. He estimates some 4 million barrels per day have been taken out of circulation as a result of Russia’s invasion of Ukraine and subsequent restrictions on doing business with the Putin government. While releasing oil from strategic petroleum reserves could help boost supply in the short-term, it’s likely that the energy industry won’t be able to increase capacity to fully offset the lost barrels. Russian oil will likely be out of the market even if Putin agrees some sort of imminent ceasefire with Ukraine, the founder of Andurand Capital Management LLP said on the latest episode of the Odd Lots podcast. Meanwhile, shale producers and some OPEC members will also struggle to boost production after years of underinvestment.
