Here’s a little comfort on the Omicron front.
In last Sunday’s Kelly Letter, I outlined why I doubted the Omicron variant would have much of an impact. My reasons included:
- South Africa sounded the alarm early, unlike certain other countries one might mention, and this early warning immediately activated worldwide surveillance and research.
- The world has more tools for dealing with the pandemic now than it had in the past, including just plain experience. We’ve all been through this.
- Vaccine tweaks are easy. Here’s epidemiologist Katelyn Jetelina: “Thanks to the new biotechnology, mRNA vaccines are really easy to alter. Once the minor change is made, only two dozen people need to enroll in a trial to make sure the updated vaccine works. Then it can be distributed to arms. Because the change is small, an updated vaccine doesn’t need Phase III trials and/or regularity approval. So, this whole process should take a max of six weeks. We haven’t heard from Moderna or Pfizer if they’ve started creating an updated vaccine, but I guarantee conversations have started behind closed doors.”
Yesterday already showed the world thinking Omicron may not be as bad as initially feared. It looks manageable:
Omicron Symptoms ‘Extremely Mild’
“Covid symptoms linked to the new Omicron variant have been described as ‘extremely mild’ by the South African doctor who first raised the alarm over the new strain.”
—CNBC
Spreading, But Nothing New
A South African epidemiologist expects the number of cases to reach more than 10,000 a day by the end of the week, but the country’s health minister says “there is absolutely no need to panic” because this “is no new territory for us. … We are now more than 20 months’ experienced in terms of Covid-19, various variants and waves.”
—BBC
Pfizer is Confident About Omicron
Pfizer CEO Albert Bourla said he has a “very high level of confidence” that the company’s Covid treatment pill is effective against Omicron. They’ve already started work on a new vaccine that could be ready in less than 100 days.
—CNBC
All Adults Should Get a Booster
CDC Director Rochelle P. Walensky: “After critical scientific evaluation, today’s unanimous decision [is that] … Based on the compelling evidence, all adults over 18 should now have equitable access to a Covid-19 booster dose.” The CDC upped its recommendation from adults “may” get a booster to “should” get one.
—CDC
This trajectory put the stock market in a better mood yesterday, following Friday’s sell-off:
Price Change Yesterday
11/29/21 (%)
– – – – – – – – – – – – – – –
+0.7 Dow
+1.9 Nasdaq
+2.3 Nasdaq 100
+1.3 S&P 500
+0.1 S&P 400
-0.3 S&P 600
Federal Reserve Chairman Jerome Powell confirmed what I called “far and away the most bullish factor from another wave of pandemic … that it might keep governments and central banks supportive.”
In prepared testimony to be delivered to the Senate Banking Committee today, he said: “The recent rise in Covid-19 cases and the emergence of the Omicron variant pose downside risks to employment and economic activity, and increased uncertainty for inflation.”
The pandemic has demonstrated that risks don’t matter to stocks nearly as much as support. Whatever keeps the central bank accommodative is fine by Wall Street. Financial markets may well get a low-cost boost from Omicron: longer stimulus from a variant that causes little damage.
It’s early, we won’t have clear answers about Omicron for weeks, but this feels familiar—and not so bad.
