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Our briefing for Thursday December 17, 2020:
Dec 17, 2020 4:23:47 PM
- French President Emanuel Macron is the latest world leader to test positive for COVID-19 on Thursday. The Elysée Palace, President Macron’s official residence confirmed the news in a statement and noted he will isolate for seven days and continue to work remotely. President Macron has been especially busy in the last week, putting him in close contact with senior French officials and other European politicians. For instance, on Wednesday President Macron met with Portugal Prime Minister, Antonio Costa for a joint press conference and a working lunch. Pictures form the meeting show both men in close contact. Spain’s Prime Minister Pedro Sanchez will isolate for 10 days after meeting with President Macron at an event in Paris on Monday.
- In the United States, as Washington lawmakers continue to bicker back and forth on the latest round of coronavirus stimulus, Bloomberg is reporting a congressional watchdog panel has asked for an investigation into Treasury Secretary Steven Mnuchin. Two Democratic Congressional Oversight appointees addressed a letter that says there are “irregularities” on how Mnuchin came to the conclusion of cancelling U.S. Federal Reserve emergency lending programs at the end of the year. The irregularities include that Mnuchin may not have consulted legal counsel before determining the program should wind down by the end of December and he may have changed his position after Joe Biden won the presidential election.
- In Canada, Ontario’s doctors are calling on the provincial government for more lockdowns as the province set yet another record for daily cases on Thursday. The latest tally was 2,432 new COVID-19 cases, which has the Ontario Hospital Association (OHA) calling for new 28-day lockdown in all regions currently in the red tier of the province’s COVID-19 framework. During a news conference on Thursday, Premier Doug Ford said he appreciates the OHA’s input, but failed to commit to any further lockdown measures, other then to say, “right now, everything is on the table.”
- The United Kingdom’s freedom from lockdown was short-lived as Health Secretary Matt Hancock revealed on Thursday more than two-thirds of England will enter tier 3 restrictions. With COVID-19 cases rapidly rising in London, Hancock also put nearby areas of Buckinghamshire, Peterborough and Hastings into the UK’s strictest category as of Saturday. Areas to the north weren’t spared as well with the Greater Manchester area forced to stay in tier 3 after local leaders believed they had done enough to have some rules eased. “I know that tier-3 measures are tough but the best way for everyone to get out of them is to pull together – not just to follow the rules but to do everything they possibly can to stop the spread of the virus,” said Hancock.
- In the Philippines, a Presidential spokesperson said the country is eyeing four vaccines for use during the first three months of 2021. The four vaccines the country plans to use are from Russia’s Gamaleya Institute and China’s Sinovac, Sinopharm and CanSino. By the second quarter of 2021, the Philippines expects to receive 2.6 million doses of COVID-19 vaccine produced by Britain’s AstraZeneca, which was secured by the private sector. However, the Philippines have yet to receive emergency vaccine use applications for any of these drugs.
- The World Health Organization (WHO) has said they will send a team of 10 international scientists to the Chinese city of Wuhan next month to investigate the origins of COVID-19. Beijing government officials have been reluctant to allow WHO investigators conduct an independent inquiry and it has taken months just to get to this point. The virus was thought to have come from a Wuhan central market that sold animals. The outbreak has been a source of tension for China as they have been on a media blitz to debunk the theory that the coronavirus got its start in the country. A biologist on the team traveling to Wuhan told the Associated Press that the WHO was not seeking to appropriate blame, rather to prevent future outbreaks, such as this in the future.
Covid-19 – Due Diligence And Asset Management
New York’s Plummeting Real Estate Sales Cost City $1.2 Billion
Brief: The pandemic’s slowdown in real estate deals has cost New York City $1.2 billion in lost revenue so far this year. Sales of commercial and residential properties -- everything from office buildings to hotels and condo units -- are down 49% this year through November, according to a report Thursday by the Real Estate Board of New York. That’s led to a 42% decline in city tax revenue, compared with the same 11-month period in 2019, the trade group said. The money comes from a long list of levies that each transaction generates. A dearth of deals means fewer collections of transfer and mansion taxes, and less income from newly recorded mortgages. Real estate investors are taking a pause amid a pandemic that’s reordered how and where New Yorkers live and work -- and, in turn, undermined property values. The pullback has dealt a crippling blow to the city’s economy, which relied on the real estate industry for 53% of its annual tax revenue in the last fiscal year, the real estate group said. While vaccines offer some optimism, “New York’s economic crisis grows,” James Whelan, the group’s president, said in a statement. “From rental assistance and unemployment benefits to state and local aid, New York needs federal relief.”
Swiss National Bank sees no Alternative to Expansive Policy to Tackle COVID-19
Brief : The Swiss National Bank paid no heed to being branded a currency manipulator by the United States, promising on Thursday to continue an expansive monetary policy and forex interventions it said were vital to cushion the impact of the coronavirus pandemic. The central bank kept its policy interest rate locked at minus 0.75%, the world’s lowest, and said it remained willing to buy foreign currencies “more strongly”, as unanimously forecast by economists in a Reuters poll. SNB Chairman Thomas Jordan said the central bank had made “considerable foreign exchange purchases this year,” but declined to give details on the level of interventions during the second half of the year. The SNB said the interventions were necessary to relieve pressure on the franc, which has attracted safe-haven inflows during the crisis. During the first half of 2020, it bought 90 billion Swiss francs ($101.94 billion) worth of foreign currencies, dwarfing the level of interventions in previous years. Those interventions have brought the SNB into the cross-hairs of the U.S. Treasury, which labelled Switzerland a currency manipulator on Wednesday.
Pensions Coping Well with Covid Crisis, says PLSA Sruvey
Brief: The vast majority of pension schemes say that Covid-19 is not having a detrimental effect on them running their schemes and helping savers achieve a better income in retirement, but have warned against the ending of regulatory easements too soon, a PLSA survey can reveal. In the survey, the PLSA heard that over four fifths of pension schemes (81 per cent) believe Covid-19 is having only little or no impact on the day-to-day running of their scheme; a figure that is up from 67 per cent in April and 42 per cent in March. Furthermore, nine out of ten schemes (91 per cent) say they are currently operating all business processes smoothly to suit the current environment. Impressively, all (100 per cent) Master Trusts and LGPS members surveyed said that their contingency plans are dealing with Covid-19 either very well or fairly well. Since the start of restrictions in the UK due to Covid-19 back in March, most schemes (85 per cent) have reported that they have not seen an increase in member queries. In fact, under one in ten (8 per cent) have said that they have seen a substantial increase since the start of the crisis, while the same proportion have seen a slight decrease. Amongst those who have seen an increase in queries, most say that this has been driven by new retirements while a smaller number report queries around changes in employment or transfers out.
Ariana Huffington: For the First Time, There’s an ‘Unprecedented Interest From the C-Suite’ in Mental Health
Brief: “Now months into the pandemic, with a dark winter ahead of us, we are seeing the evidence of an increase in depression, anxiety, and worker burnout everywhere, both among those of us who have the luxury of being able to work from home and the frontline workers,” Huffington told Yahoo Finance Live. Huffington founded Thrive Global four years ago as a behavior change platform that combines data, storytelling, and an action plan to improve work culture and support staff. It serves mostly Fortune 500 companies, including Walmart and Accenture. “For the first time, we are seeing an unprecedented interest from the C-suite on this issue of mental health,” said Huffington. “So, it's not just a matter for HR professionals. The recognition is now clear, that the well-being and mental resilience of your employees is going to be crucial to productivity and the bottom line.”
Wells Fargo Extends Work From Home Until at Least March 1
Brief: Wells Fargo & Co has extended the ability to work from home for employees until at least March 1 amid the ongoing coronavirus outbreak, a spokeswoman for the bank said on Wednesday. “Through at least March 1, we will continue with our current operating model, which includes about 200,000 employees working from home and maintaining safety measures in locations that remain open”, the spokeswoman said in an emailed statement. The statement added that it was not known when the bank would return to a more “traditional operating model” and that it would give employees “sufficient notice” before any changes.
After COVID Shock, U.S. Treasury Market Set for New Scrutiny
Brief: The $20 trillion U.S. Treasury market is set to come under intense scrutiny by President-elect Joe Biden’s regulators, after seizing-up amid rising pandemic fears in March and threatening the stability of the broader financial system. A review of what went wrong and measures to boost the market’s resilience could be among the first regulatory challenges for incoming Treasury Secretary Janet Yellen, according to half a dozen regulatory and industry sources. After March’s massive sell-off prompted the Federal Reserve to buy $1.6 trillion of Treasuries to stabilize the market, consensus is growing in Washington that a review is urgently needed. But potential changes on the table, including loosening trading rules, allowing new players into the market, or introducing central clearing, could prove risky to implement and unleash industry infighting over the benefits and costs. “This is the most important financial market in the world. That fact demands policymakers exhibit both urgency and extreme care,” said Gregg Gelzinis, senior policy analyst at think tank the Center for American Progress.
