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Our briefing for Wednesday, September 15, 2021:
Sep 15, 2021 3:28:16 PM
- In the United States, case numbers and hospitalizations are still on the rise as delta continues to tear through the country. Cases are nearing levels not seen since last winter, averaging at about 170,000 per day, with deaths at around 1800 per day. This is still well below the peaks of January, when cases were hovering around a quarter-million per day, however officials are especially concerned about vaccine hesitancy as the majority of cases and deaths are among the unvaccinated. U.S. President Joe Biden says this is a “pandemic of the unvaccinated,” and his administration continues to advocate for widespread vaccine mandates.
- In Canada, the province of Ontario has released more details of their vaccine passport program, which is set to come into effect on Sept. 22. The vaccine passports will be required in what are deemed to be high risk indoor spaces, such as indoor restaurants, bars, nightclubs, sports and fitness facilities, concerts and other large events. Individuals and businesses that don’t comply with the rules could be fined or charged, officials say. Meanwhile, the province of Nova Scotia has delayed the move into their final reopening phase as a result of rising case numbers. The province will now enter Phase 5 in two and half weeks, after their proof of vaccination policy takes effect.
- In the United Kingdom, Prime Minister Boris Johnson has unveiled the government’s winter plans for dealing with Covid-19. Under Plan A, ministers will encourage widespread vaccinations, offer jabs to 12-15-year-olds and begin a booster program. Plan B, which the government will enact if the National Health Service (NHS) becomes overwhelmed, will mean the return of mask mandates, vaccine passports and guidance on working from home. “What I would stress about Plan B is that contains a number of different shots in the locker. And you wouldn’t necessarily play them all at once, far from it. You’d want to do things in a graduated way,” Johnson said at a news conference on Tuesday.
- In France, vaccines for healthcare workers are now mandatory, and people could face suspension from their jobs if they don’t comply. According to government officials, more than 90% of healthcare workers in France are vaccinated, which means that about 300,000 still haven’t got their shots. Unvaccinated healthcare workers can face suspensions without pay, but a top court has ruled that they cannot be fired outright. Healthcare workers who have only received one shot are required to take a Covid-19 test every three days until they receive their second one. Both shots are required for all healthcare workers as of October 15.
- In New Zealand, officials are pushing to speed up the country’s vaccination campaign, as case numbers begin to fall. The country reported 15 new infections on Tuesday, down from 33 the previous day, with lockdowns and border closures credited with keeping the numbers lower. "The vaccine is the best tool we have in our toolbox and our ticket to greater freedom," Prime Minister Jacinda Ardern told a news conference. "The more people who are vaccinated, the fewer restrictions you have to have." So far, only about 34% of New Zealand’s population have been fully vaccinated.
- In Australia, a nightly curfew that was imposed on Sydney’s suburbs will be lifted, authorities announced, though other curbs will remain in place. In New South Wales (NSW), 80% of adults have now had at least one dose of vaccine, while 48% are fully vaccinated. "The stabilization and decline in some areas of concern are pleasing and we are at a critical stage... but the best advice we have is that it's too early and too risky to do anything further today," said Premier Gladys Berejiklian during a media conference. NSW reported 1259 new cases, up slightly from 1127 the previous day.
Covid-19 – Due Diligence And Asset Management
TD's U.S. head sees 'sort of a pause' in the economic recovery
Brief: Toronto-Dominion Bank’s top U.S. executive said the American economic recovery has hit some speed bumps over the past month and a half, with COVID-19’s Delta variant spreading and businesses finding it difficult to hire qualified workers. “We’ve seen sort of a pause and in some spaces or industries -- a little bit of a tapping on the brakes,” Greg Braca, Toronto-Dominion’s head of U.S. retail banking, said at a Barclays Plc conference Wednesday. “And we’re watching how this plays out.” The U.S. economy gained 235,000 jobs last month, the smallest increase in seven months. Still, the large amount of cash that consumers have stockpiled along with a low level of loan defaults are keeping the bank “bullish” for the remainder of the year, Braca said at the virtual event.
Pandemic Inflation Has Flipped: Now It’s the Rich Who Pay More
Brief: Inflation rates are now higher for top-earning U.S. households than those on low incomes, reversing the trend that took hold earlier in the pandemic, according to research by Harvard economist Alberto Cavallo. Covid-19 has caused headaches for price statisticians because it’s changed the way people spend. Headline measures of U.S. inflation use a basket of goods and services that’s based on pre-pandemic shopping habits -- so it doesn’t always capture the higher prices that Americans have been paying in the past 18 months or so. Cavallo, an inflation specialist, has come up with baskets weighted according to what consumers actually spent money on since the pandemic began. He found that the inflation rates experienced by different income groups, which were broadly similar in 2019, have diverged since then. In the pandemic’s first year, prices were rising faster for low-earners. In the last few months the opposite is true.
Amundi's Wosol: Covid stocks still trading at 'significantly low' valuations
Brief: The head of the largest European value fund in the world believes the European value rotation has further to go as the threat of further lockdowns and new variants keeps Covid-related stocks underpriced. Andreas Wosol, Amundi's head of value who manages around €5bn in European equity value strategies, told Investment Week both Covid-related stocks and cyclicals are trading below pre-pandemic levels, creating opportunities for investors. "People are talking about a fourth lockdown, another wave of the Delta variant coming into play this autumn or winter so these stocks are still not fully back to their pre-Covid situation, making them an area in the market where you might expect recovery potential," he said. Wosol sees a lot of opportunities in the more consumer-focused areas of the market, including the automotive industry, media, and entertainment, as well as cyclical consumer areas, such as the retail that are trading "significantly low".
UN Says World Economy to Grow at Fastest Pace in Almost 50 Years
Brief: The global economy is expected to undergo its fastest recovery in almost five decades this year, but deepening inequities between advanced and developing countries threaten to undermine this, the United Nations warned. Following last year’s 3.5% contraction, world gross domestic product will likely surge 5.3% in 2021 due to “radical” policy interventions and a successful, if incomplete, vaccine rollout in advanced economies, the UN Conference on Trade and Development said in a report Wednesday. Expansion may slow to 3.6% next year, taking the estimated cumulative income loss since 2020 to $13 trillion, it said. Many countries in the southern hemisphere have been hit especially hard during the pandemic, and fiscal constraints, a lack of monetary autonomy and poor access to Covid-19 vaccines could escalate economic stress on developing nations, according to the report.
ECB’s Lagarde Sees Part-Time Home Office Outlasting Pandemic
Brief: Office workers probably won’t return to their desks full-time as companies learned to live with flexible arrangements during the coronavirus pandemic, according to European Central Bank President Christine Lagarde. “We’re heading toward a hybrid movement, where part of the week will be spent in the office so that people can meet, can see each other, can hold regular meetings and have face-to-face contact,” she said on “The David Rubenstein Show: Peer-to-Peer Conversations” on Bloomberg Television. “But the rest of the week will likely be working from home.” While the exact design of these new arrangements still needs to be determined, “people have learned during the pandemic, and those learnings will be bottled in and used for the future way of working,” Lagarde said.
