It’s hard to remember that there’s still a pandemic going on. Vaccination rates have increased and it looks like we may be on the cusp of a roaring 20s. Consumers are healthy and eager to make up for lost time–booking travel and eating out. Offices will probably re-open by the end of summer but working from home is likely to remain an option.
As vaccines continue to be administered the end of the pandemic appears to be at hand. People are resuming normal lives and pent up demand is being unleashed. Consumers are looking forward to a summer filled with travel and congregation with family and friends. Even the Fed is noticing the brighter outlook. The world is opening back up but it probably won’t ever be the same as it was before the Pandemic.
Succinct Summary: Retailers reported strong quarters last week showing that the US consumer remains resilient despite high unemployment. A new wave of Covid could slow the economy back down but vaccines are almost here. It will be interesting to see what behaviors have been permanently altered by the pandemic and which ones will return to the way that they were. Business travel is one thing that may be permanently changed.
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Succinct Summary: Pfizer announced that its vaccine is 90% effective and that gave a boost to market confidence. The vaccine could be great news for the industry and great news for society. Pfizer says that it will have over 1B doses ready next year. The vaccine could lead to some reflationary outcomes.
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Succinct Summary: Many companies and individuals have been hard hit by the pandemic and are having a tough time. All eyes are on another stimulus package to try to cushion them. Worryingly, cases are rising worldwide even in areas that were thought to have contained the virus. The picture from July and early August is one of a mixed and uneven recovery.
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Succinct Summary: Companies are reporting signs of improvement in the economy. But the rebound is coming off such a low base that these numbers would still be considered very bad in any other environment. The duration of this rebound will depend heavily on whether or not there’s a second wave of infections. Still, even without the virus it probably will take the economy a long time to recover from such a severe shock.
On an industry basis: private capital markets are searching for price levels; consumers are dreaming of the future; tech is chugging along; and the industrial/energy economy is feeling immense pain.
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Succinct Summary: Companies are now growing increasingly worried about the short-term impact of the Coronavirus. Those with exposure to China are issuing wider-than-normal guidance. Despite this, most are cautiously optimistic on overall growth.
Succinct Summary: It’s hard not to be happy about the economy. The consumer is strong and business sentiment has turned positive. Recession fears have abated thanks to the actions of central banks and a trade truce with China. Markets are feeling optimistic.
Succinct Summary: The economic expansion is now in its 11th year. The US consumer remains strong but business investment has been weak. A stat on the real effect of the trade war: Samsonite has taken its supply chain from 90% China production to 67 %, and is intent on reducing it further to 50%. Meanwhile, air flights and India are the final frontiers of the internet.
Succinct Summary: The consumer is strong but manufacturing is weak. Everyone is tired of Brexit and tech IPOs probably still have a path to market as long as they have a path to profitability.