When government calls for social restraint or implements COVID restrictions in order as claimed to slow the spread of the latest variant and reduce demands on the health service. The result are curbs on people’s liberty and a reduction in economic activity. Whether these are justified or effective are the subject of political debate and arguing over statistical interpretation. This much has become clear.
The issue of compensation for various affected economic sectors will become a political issue in the coming months unless government quickly reacts to emerging research over the milder effects of the Omicron variant than experienced with the Delta variant. Their decision to lift or keep restrictions light and brief will be critical. There are unsurprisingly reports and articles taking both sides of the argument over its threat to people’s health. Try a Google search as they are all there to see.
It does suggest there are political positions taken over issues of control and access to travel and services once freely available to all within the wider COVID situation. Notably, with each phase of restrictions, calls for bans or pressures to follow the emergency-legislation imposed rules come all to swift and easily to those who holds such opinions and preferences. Anti-vaxxers are now akin to the morally scandalous rather than holding an alternative, but still wrong, opinion. Listen to the Archbishop of Canterbury’s comments to hear such a critique.
Therefore, what’s best thing to do- take your booster and wear your mask in crowded places seems the simplest solution of how to live with continuing COVID. However, between the anti-vaxxers and authoritarians that option lacks appeal. It requires either compliance to authority, sensible or not, to which the anti’s object to or not enough direct control over individual’s travel or access rights. The business of appearing to care about the NHS and the welfare of all appeals strongly to the authoritarian minded politicians of both left and right of centre government in the UK. A medical-clerical elite seems to be in the ascendant. Sadly, the antis are now the most hospitalised and their lack of immunity will likely prolong the pandemic effects.
The latest COVID restrictions being implemented in the UK, and elsewhere in Europe, will affect markets over the opening months in 2022. Markets have already reacted to the emergence of the Omicron variant. Although may do further if government keeps applying restrictions to movement, circulation, and thereby economic activity. This combined with any further worrying developments with Russia and its troop build-up on its border with Ukraine would upset confidence greatly and see markets across the asset-classes fall and probably quite dramatically during 2022.
Surely, common sense there is to strike a bargain over gas supply rights with the Russia government and its Gazprom satellite over its use of the Nord Stream 2 pipeline. Germany would clearly be in a strong position to bring some closure to this dangerous game. Similar with US and Chinese relations over their positions in the East China Sea and Taiwan. Careful diplomacy rather than belligerent war games using mock-ups of each other’s military hardware is further required in ’22.
Therefore, on 2022’s to do list are to avoid further unnecessary wars which clearly require a coherent dose of diplomacy and meaningful international dialogue between world leaders with co-operation amongst NATO members, Russia and China too. In the UK some more progress on post-Brexit trade negotiations with the US and EU countries too with a Northern Ireland resolution. Gearing up for an electric future with battery research and production capacity with clean-technology development and not postponing projects or shifting deadlines should help.
All-in-all the world is getting better, healthier, and safer and should be in 2022 unless mistakes, bad judgment and leadership let everyone down.
Happy New Year.
LDC.