Happy new year 2021

Happy New Year, everyone. I am going to leg into this new year slowly with a thought piece – no charts, no quotes, no numbers. I had thought about updating you last week when the US claims numbers came in. But I think having a couple weeks’ reflection has been good to get a different macro perspective. And I’m going to try to put that into words now.

Tearing and fraying?

The period just after the new year begins is a period of hope. This is true this year more than most given how awful the pandemic made 2020. But 2020 wasn’t just about the pandemic. It was also about the uniquely perverse  and unequal economic and healthcare outcomes it brought with it.  Add in the electoral upheaval in the States, Brexit in the UK and cyber breaches everywhere at US corporates and in government and you have a pretty awful year.

Yet, at the same time, equity markets are at or near all time record highs in the US. Bitcoin hit $33 or $34,000 over the weekend. But, it’s not just about speculative excess. That unequal economic outcome has been a big part of it too. And white collar workers have transitioned to work from home lives with relative ease, even cutting down on costs along the way. I know people who have bought and lived in vacation homes for several months at a time, away from the hustle and bustle – and danger – of large metropolises.

In my mind, there is a tearing and fraying in the US at the fabric of the shared sense of community that holds people together. This seems less true in other advanced nations – Germany or Sweden or Denmark or the Netherlands. The sense I get is that, for many in those countries, 2020 has validated their ‘systems’. It’s given people a sense that they’re in this together.  Maybe I’m wrong. But that’s the mood I sense. And it means that, as 2021 begins, the eurozone is more bonded together than it was beforehand.

The US is unique in its tearing and fraying then. And the big question for 2021 goes to whether we can heal those ruptures.


Forget about the logistical quagmire that administering Covid-19 vaccines  has been. That’s the hope right there – that we faced down a deadly, life-changing disease and conquered it with a vaccine in record time. Actually, we have not just one or two different vaccines that are in production, but a baker’s dozen. By the end of this year, you might have several different ones to choose from. And then, we will be free to resume our normal lives, appreciating the freedoms we’ve lost during the pandemic that much more.

So, as bad as 2020 was, 2021 offers us hope for the future. How much can we hope? I am thinking mid-year i.e. the Fall before a reasonable sense of normalcy resumes. That’s my hope. And when it resumes, my hope is that the life support governments have administered to households and businesses will have been enough to see us through the fallow period. Further, I am hoping – and expecting – there to be pent up demand for the services we’ve lost – the vacations, the travel, the hotel stays, the dining out – all of that, before we settle into a new post-pandemic rhythm.


I’d be lying to you if I didn’t admit to worries and fears though. I worry that the logistical quagmire of administering the vaccine will be too much for governments to bear – and we won’t recover from the damage for years. I also worry that the US has torn and frayed too much to recover. The US presidential election that is still being contested by President Trump and some allies in Congress is evidence supporting that worry. And, of course, I worry about the unequal outcomes of the pandemic – and what that will mean politically.

As 2021 starts, I am personally in a more glass half full frame of mind. I still see the European and US economies in recession this quarter, taking the global economy into recession. But I am more in the glass half full camp because I think the vaccines give us that beacon to sail toward. And I believe that will help us to avoid worst case outcomes.

I am a realist though. And I know these next few months will be difficult. Let’s brace ourselves for what’s about to come, and hope our leaders put in place a safety net that will keep as many people from deprivation as possible.

Here’s wishing you a happy 2021.

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