Questionable mortality analysis from CDC: https://apnews.com/article/health-pandemics-covid-c9de68e76908f132c6cf971d484546e8 . This type of mortality statistic is essentially useless. Mortality data must be correlated to age and population size to create useful information. It is disturbing that the person leading mortality surveillance at CDC apparently does not understand that. Also, mortality statistics will obviously not return to pre-COVID levels until we are past the pandemic stage of this disease. We are not there yet. While there were a horrific 73,000 deaths in January 2022, there have been an additional 190,000 COVID deaths from February through mid-December.
Chinese pronouncements that Omicron is less dangerous than prior variants defy the facts. This is especially true as the US has broad levels of effective vaccination and natural immunity from prior COVID waves. Mass murder is coming to China, and their reduction in COVID reporting is offensive.
China to import Pfizer’s Paxlovid: https://www.usnews.com/news/top-news/articles/2022-12-14/china-meheco-to-distribute-pfizers-covid-treatment-in-china .
COVID decimating Chinese hospital staffs: https://www.usnews.com/news/world/articles/2022-12-14/medical-staff-in-chinas-hospitals-say-covid-19-ripping-through-their-ranks . WSJ: More: https://www.wsj.com/articles/chinas-covid-19-surge-puts-strain-on-medical-workers-11671055080 . The story here describes a Chinese medical student who reported a fever but was asked to participate in surgery anyway. Afterwards, he collapsed and died, and is believed to have been COVID positive. This should give everyone pause about the COVID tsunami coming for China.
WSJ: Latest summary of COVID drug treatments: https://www.wsj.com/articles/what-you-should-know-about-treating-covid-19-11638468809 .
WSJ: US healthcare spending rose 2.7% in 2021: https://www.wsj.com/articles/u-s-healthcare-spending-growth-slowed-in-2021-federal-report-finds-11671046871 . With the announcement of new and expensive drug treatments in the past few months, I would expect healthcare inflation will return to outstripping general inflation in 2023. Also, 2022 healthcare inflation is likely more than double the 2.7% cited for 2021.
Africa’s growing food crisis: https://www.usnews.com/news/world/articles/2022-12-14/africas-food-crisis-is-the-biggest-yet-five-reasons-why . Grain exports from Ukraine and Russia are critical to alleviating this suffering.
As expected, Fed raises rates 50 basis points: https://news.yahoo.com/federal-reserve-meeting-interest-rate-announcement-december-14-180643459.html . Also as expected, Fed raises ultimate interest rate prediction to 5.1%. Note that 7 officials see that rate higher, with 5 around 5.25% and two at 5.6%. My sense is that a reduction in inflation by year-end to 4.8% is overly optimistic, and that the ultimate rate will be above 5.1% and 5.25%. That is, the 5.6% is more realistic but may also be too low. If inflation stays at or above 5% (as I expect), then my original ultimate prediction of 6% to 7% still holds. WSJ: More: https://www.wsj.com/articles/fed-raises-rate-by-0-5-percentage-point-signals-more-increases-likely-11671044561 .
The argument being made on the other side is to let the data play out and hopefully avoid a recession. That continues to seem unrealistic because most economic indicators continue to point toward a 2023 recession. However, this argument does play well with timid policymakers. Rate increases are likely to continue, but there will be at most one more 50 basis point increase before settling in at 25 bp’s. WSJ: Here’s the effect on personal finances: https://www.wsj.com/articles/what-fed-interest-rate-increases-mean-for-your-2023-financial-plans-11671022101 . Good quote: “You marry a property, but you date an interest rate.” It’s true you can refinance in the future, but that’s more difficult if the property’s value drops. And that is a real risk right now.
WSJ: We tout stocks, so we just ignore what the Fed says: https://www.wsj.com/articles/feds-walk-may-be-more-dovish-than-its-talk-11671053830 . The market has continuously predicted easing from the Fed this year. It has been wrong every time. The Fed will lose significant credibility if it backs down before nearing its 2% inflation target.
Even on Wall Street, there are many voices saying the current market is distorted: https://news.yahoo.com/distorted-markets-mohamed-el-erian-134000279.html .
WSJ: UK inflation eases slightly: https://www.wsj.com/articles/u-k-inflation-eased-in-november-following-global-trend-11671004437 . Let’s see how energy prices affect the UK over the next 4 months.
WSJ: Florida enacts property insurance reform: https://www.wsj.com/articles/florida-lawmakers-approve-property-insurance-overhaul-sending-bill-to-desantis-11671048780 . Given the problems climate change is causing for Florida, it does not make sense that $1 billion of funding will stabilize this market. Hurricane Ian caused an estimated $67 billion in damage, mostly in Florida: https://www.axios.com/2022/12/01/hurricane-ian-florida-costliest-disaster-swiss-re . I had previously commented that the Florida legislature (GOP-controlled) lacked the intellectual ability to address this problem. Even so, this effort is ridiculous on its face.
FTX bankruptcy: latest summary: https://www.cnn.com/2022/12/13/business/ftx-sbf-december-13/index.html . WSJ: Iillegal campaign contributions: https://www.wsj.com/articles/sam-bankman-frieds-alleged-campaign-finance-violations-explained-11670985176 . These problems could have been avoided if even minimal corporate oversight was in place. This story is an indication of the utter lack of financial controls. How did this happen in a currency repository? Operating from the Bahamas seems to be a huge clue. More: https://www.wsj.com/articles/ftx-digital-executive-warned-of-client-fund-transfers-to-alameda-documents-show-11671066191 . Still more: https://www.wsj.com/articles/caroline-ellison-was-alamedas-ceo-but-officials-say-sam-bankman-fried-ran-it-11671038236 .
WSJ: “Analysis” of the CFTC filing against FTX: https://www.wsj.com/articles/ftx-fraud-suits-offer-blueprint-for-pursuing-offshore-crypto-exchanges-11670990401 . You would think someone at the Journal understands that this is a blueprint for crypto regulation and litigation only if a court accepts it. The Supreme Court is already negotiating a path that reads regulatory powers narrowly, so the outcome here is far from certain.
WSJ: Another recession stimulant: SBA pandemic loan repayment: https://www.wsj.com/articles/pandemic-loans-are-coming-due-but-some-businesses-arent-ready-to-repay-11670982463 . The easy money kept many businesses operating that did not have a sound underlying business plan. Many of these businesses will now find that reality closes their doors.
Dissent over Ukraine war increases within Russia’s military: https://www.huffingtonpost.co.uk/entry/eussia-military-chiefs-hit-by-factional-tensions-over-ukraine-war_uk_6399741ce4b0c2814648297f . WSJ: Ukraine fends off latest drone attack on Kyiv: https://www.wsj.com/articles/ukraine-fends-off-fresh-wave-of-drone-attacks-on-kyiv-11671010851 . Russia’s actions continue to push the West toward greater air defense for Ukraine.
WSJ: Our “Dump OJ” campaign continues: https://www.wsj.com/articles/ron-desantis-holds-early-lead-over-donald-trump-among-gop-primary-voters-wsj-poll-shows-11670989311 . The problem for the GOP is that OJ won’t withdraw, ever, and will tar “DeSanctimonius” with everything he can think up. It won’t be pretty, which is good for democracy if not the GOP.
WSJ: Interest in fusion grows: https://www.wsj.com/articles/fusion-industry-suddenly-white-hot-after-u-s-lab-breakthrough-11671026572 . More: https://www.wsj.com/articles/nuclear-fusion-breakthrough-what-to-know-11670976073 .
“Rockford Files” actor Stuart Margolin passes at 82: https://variety.com/2022/tv/news/stuart-margolin-dead-the-rockford-files-1235459928/ .
Jodi Ernst correction: I had previously written that Jodi Ernst had been in a long-term lesbian relationship. However, that comment was apparently incorrect; the sources previously cited no longer support that conclusion. Ernst allegedly had a relationship while in the military, but that is now described as with a male. Also, her (male) husband’s name is Gail, which may have contributed to prior misattribution. I regret the error. This does make her vote for the Respect for Marriage Act more courageous.
World Cup 2022: In addition to the final Sunday (Argentina v France), there is also a third place game (Croatia v Morocco) on Saturday, also at 7 am Pacific. WSJ: France beats Morocco: https://www.wsj.com/articles/france-morocco-world-cup-semifinal-11671051327 . More on Argentina: https://www.wsj.com/articles/lionel-messi-world-cup-final-argentina-11671029107 .