New Years eve in Clareville, California: after four days of
rain (for Southern California this is a big deal) cloudless skies and 62
degrees highlight the end of 2021.
2021 was a year of many more lows than highs. The COVID
virus claimed 823,000 American lives, 105,000 lives were lost to drug
overdoses, the majority from opioid use. Marines from the 2nd Battalion, 1st
Marines Regiment were on duty outside the Kabul airport on Aug. 26 when a
suicide bomber detonated explosives, killing at 13 U.S. service members and
scores of Afghans. Of the 13 American service members — 11 of them Marines —
killed in the suicide bombing on Aug. 26, five were 20 years old, and seven
more were in their early 20s. One was 31. Finally, On January 6, 2021, a mob of
supporters of President Donald Trump attacked the United States Capitol in
Washington, D.C. They sought to overturn his defeat in the 2020 presidential
election by disrupting the joint session of Congress assembled to count
electoral votes that would formalize then President-elect Joe Biden's victory.
Individuals we lost in 2021:
Hank Aaron (86), Michael Collins (90), Bob Dole (98),
Olympia Dukakis (89), Lee Elder (87), Larry King (87), Rush Limbaugh (70), John
Madden (85), Colin Powell (84), Harry Reid (82), Stephen Sondheim (91), Desmond
Tutu (90), Cicely Tyson (96), Betty White (99).
Well it's finally here! The end of one nasty ass year!
Congratulations to all of you for getting through it. Now as we are facing the
New Year, it's time for New Year's resolutions! I've got mine already, and it
is a simple one (with the unknowns ahead in 2022). My resolution is for making
a hole-in-one in 2022. I have never had one, it is about time. Stay tuned.
MARKET YEAR - U.S. stocks saw a third consecutive year of
big gains, with major indexes closing 2021 near record highs.
Even with the recent turbulence from the Omicron coronavirus
variant, the S&P 500 saw a 27% advance for 2021 and has hit 70 highs. It is
the third straight year of double-digit gains for the broad index, and the
second in the midst of the Covid-19 pandemic. The Dow Jones Industrial Average
and Nasdaq Composite have gained 19% and 21%, respectively, this year, helping
send the major indexes to their best three-year performance since 1999.
Some traders note that warning signs are flashing: Inflation
could turn companies’ and customers’ finances upside down. Many companies that
have been market darlings are losing money. Big-name stocks continue to log
giant one-day swings. However, individual traders and institutional investors
are hungry to take bigger risks and willing to accept bouts of volatility.
The year kicked off with a mind-bending start: Day traders
who poked around with stocks early in the pandemic plowed money into meme
stocks such as GameStop Corp., disrupting the power dynamic by which
professional investors are usually the market king. Money managers say that
this year more than ever, they are closely tracking where individual investors
park their cash and monitoring their trading activity for clues on the market’s
moves.
Cryptocurrencies further entered the mainstream, helped by
influencers including Elon Musk and the debut of the first bitcoin
exchange-traded fund. Crypto prices soared, then spiraled lower, then soared
again. The market for nonfungible tokens exploded.
Many investors, both institutional and individual, into options,
a shift that can make the market vulnerable to bigger swings, some traders have
said. Trading activity in options, which give traders the right to buy or sell
stocks at a specific price by a stated date, hit the highest level in the
industry’s history in data going back to 1973.
Initial public offerings and special-purpose acquisition
companies, known as SPACs, broke record after record. SPACs as of last week had
raised $162 billion in 2021, more than what they raised in the previous decade
combined, according to Dealogic. Many of them are unprofitable; around 70% of
companies going public through traditional IPOs have been losing money, a
greater proportion than even during the tech bubble of the 1990s, according to
Bank of America figures as of November.
The heavy speculation left some investors questioning if
markets were in a giant bubble, though some of the excitement has started to
fizzle. Near-zero interest rates and the central bank’s pandemic interventions
have been a key support for stock markets for nearly two years now. The Federal
Reserve signaled this month that it is prepared to raise rates next year and
pare its bond-buying program at a quicker pace. When rates rise, investors have
more options for where to park their money for a gain and can become less
willing to take risks.
Investors also had to contend with one big factor that they
mostly ignored for the past decade: inflation. U.S. inflation reached nearly a
four-decade high last month, raising questions about how many price increases
Americans can absorb. The emergence of the Omicron variant has whipsawed U.S.
stocks since Thanksgiving.
Our economy was driven by the five key factors:
(1). COVID, (2).
Inflation, (3). Supply Chain¸ (4). Reply All emails, (5). Too many Six
Sigma White Belt certifications.
DRIVING THE YEAR - Inflation, which is the rate of price
increases over time, affects all of us on a personal level. We pay electric
bills, go grocery shopping, decorate our houses, buy cars—and this year all of
those things got more expensive.
Like, way more expensive. Thanks to a nefarious mix of
soaring demand for goods and snarled supply chains, US consumer prices jumped
the most in 39 years in November, and the 6.8% inflation rate marked the sixth
straight month inflation grew by 5% or more. Producer prices, which can
eventually trickle down to individuals, also increased at their fastest pace on
record last month.
Of course, some inflation is good for the economy when wages
keep up with rising prices (the Fed aims for a 2% inflation rate over time).
But, so far in the pandemic, that hasn’t happened. While many Americans have
gotten a raise in 2021, wage gains haven’t been sufficient to offset inflation,
resulting in the erosion of purchasing power—especially for folks on a more or
less fixed income.
Where do we go from here?
After months of claiming inflation was “transitory,” the Fed
has dropped that term and adopted a more hawkish monetary policy to tamp down
surging prices. The central bank is winding down its bond-buying stimulus
program faster than originally planned, and also plans to hike interest rates
three times in 2022.
In its inflation-fighting efforts, the Fed isn’t alone on
the front lines. The Bank of England became the first major central bank to
raise interest rates during the pandemic in order to combat the biggest annual
jump in consumer prices in 10 years. Russia has raised rates seven times this
year. Mexico, Chile, Costa Rica, Pakistan, and Hungary are among other
countries which are tightening monetary policy to combat higher prices.
Looking ahead…as if economic policymakers needed another
inflation curveball, Omicron has taken the mound. Central banks generally don’t
expect the new variant to significantly dent economic growth, but they do think
it may prolong inflation by exacerbating the supply–demand imbalance that
fueled higher prices in the first place.
WAGES - A record number of states and cities will raise
their minimum wages in 2022, with many exceeding $15.
Since the start of the pandemic, workers have been quitting
in droves, citing low pay as a major culprit.
An analysis by the National Employment Law Project found 25
states and 56 municipalities will raise their minimum wages by the end of 2022.
In California and New York, as well as 47 cities and
counties, the wage floor will meet or exceed $15 per hour by the end of 2022.
Reality check: 20 states haven't raised their minimum wages
above the federal level, which has remained at $7.25 per hour since 2009.
2021’s MOST IMPORTANT COMPANY - Until recently, Pfizer was
perhaps best known as the maker of Viagra. Then the pandemic happened, and the
NYC-based pharma giant was taken a lot more seriously thanks to the Covid
vaccine it produced in partnership with BioNTech.
That vaccine, which marshals cutting-edge mRNA technology,
proved to be highly effective against Covid, saving countless lives and paving
the way for a rapid global economic recovery.
Against the Omicron variant, however, a two-shot regiment of
Pfizer’s vaccine offers only reduced protection. Adding a third booster shot
restores effectiveness, according to a study from Pfizer and BioNTech.
But more shots = more sales, and Pfizer’s had plenty of
those. The company expects to bring in $36 billion in revenue from its vaccine
this year, which would put it among the top
selling drugs of all time. Thanks to its effectiveness,
negligible side effects, and its ability to be produced in mass quantities,
Pfizer’s vaccine has beaten out Moderna’s, J&J’s, AstraZeneca’s, and others
as the “world’s preferred shot.”.
As Pfizer’s profile has grown, so has the influence of CEO
Albert Bourla. During the pandemic, the Greek-born veterinarian and longtime
company exec has counseled leaders across the globe, even becoming a “good
friend” of the US president, as Joe Biden asserted. Former Israeli Prime
Minister Benjamin Netanyahu called Bourla 30 times in the run-up to the
country’s election, according to the FT.
Pfizer has plenty of critics, though, who say it has not
done nearly enough to send vaccines to lower-income countries, where
immunization rates are far lower than in higher-income nations. Leaders in
Africa have accused the company of playing “hardball” and making “unreasonable
demands” in terms of the legal concessions it required of governments there
during contract negotiations.
Pfizer claims vaccine inequity isn’t its fault: “The low-
and middle-income countries will be behind in deliveries because they didn’t
place their orders,” Bourla said on a November earnings call.
Looking ahead…Pfizer’s top-line revenue could be astonishing
next year. While it projects another $29 billion in annual sales from its
vaccine, it has also developed a Covid antiviral pill, Paxlovid, which was
authorized by the FDA this month. That drug could bring in an estimated $17
billion in revenue in 2022.
Runner up: SpaceX. Elon Musk’s company is the clear leader
in the fast-growing private space industry, and it had itself an impressive
2021. It beat out Blue Origin for a lunar lander contract with NASA, launched
the first-ever mission of all amateur astronauts, and, since May 2019 it has
sent nearly 2,000 satellites into low-Earth orbit to build out its Starlink
broadband internet system.
Runner up: Amazon. Founder Jeff Bezos may have stepped down
as CEO over the summer, but under new CEO Andy Jassy the company is continuing
to expand its reach into areas like advertising, media rights, and logistics.
It still has a strained relationship with its warehouse and delivery workers
(remember the pee bottles?)—a high-profile union vote at an Alabama facility
was defeated in April, but workers there will get a chance at another vote
after the National Labor Relations Board found that the company improperly
tampered with the first election.
2021 INSPIRATION - Simone Biles, the GOAT women’s gymnast,
was expected to leave the Tokyo Olympics with a carry-on full of gold medals.
Instead, she took a step back to take care of herself.
It all started during the team final. After a rough vault
routine, the 4-time Olympic gold medalist left the floor, stunning the American
fans watching from home early that morning. Her teammate Jordan Chiles filled
in on the uneven bars and helped team USA snag the silver medal.
Biles ultimately dropped out of the all-around final as well
as the floor, uneven bars, and vault finals to prioritize her well-being. Biles
later posted on Instagram that her “mind & body are simply not in sync,” a
phenomenon that could lead to injury in highly technical and dangerous sports
like gymnastics.
She did finish her Tokyo campaign with a bronze medal in the
balance beam final, securing a tie with Shannon Miller as the most decorated
American in the history of Olympic gymnastics.
“I truly do feel like I have the weight of the world on my
shoulders at times,” Biles wrote on Instagram after the Olympic prelims.
Biles’s focus on mental health at the Olympics is part of a
larger trend this year of athletes opening up about the emotional toll of
high-level competition. In a press conference, Biles told reporters she felt
inspired to prioritize her health over competing after watching Naomi Osaka
withdraw from the French Open for mental health reasons.
Runner up: NASA’s Perseverance rover lands on Mars. There’s
just something about a little guy making it to space. Around 4pm ET on February
18, NASA’s most sophisticated rover to date, Perseverance, landed in the giant
crater Jezero on Mars. The Rover will spend one full Mars year abroad—687 Earth
days or ~4,809 dog days if that is more helpful—searching for signs of ancient
life on the planet.
2021 JACK ASS OF THE YEAR – Two words: The Thing.
2021 was remembered most vividly by its first month, when a
sitting President and his allies attempted a coup by trying to overturn an
election. Most notable was the January 6 insurrection of the U.S. Capital.
NCAA (NO CLUE AT ALL) - The NCAA board of governors on
December 16 unanimously agreed to accept the final recommendations from its
constitution committee, moving the organization another step closer to a new
constitution to govern college sports.
One of the changes is clarifying language that ensures
"to the greatest extent possible" that any imposed penalties do not
punish programs or athletes who were not involved or implicated in the
infractions -- a modification to the typically lengthy investigative process
that sometimes isn't resolved until after the individuals who committed the
violations have moved on.
Another change from the second draft of the constitution,
which was shared Dec. 7, requires each school to make its name, image and
likeness policies publicly available.
The new constitution continues to prohibit pay-for-play but
states that athletes "may receive educational and other benefits in
accordance with guidelines established by their NCAA division."
The entire NCAA membership will vote Jan. 20 at the 2022
NCAA Convention. If the constitution is formally adopted, as expected, each of
the NCAA's three divisions will be tasked with ensuring that its rules fit the
new framework. The new constitution would be effective Aug. 1.
The proposed constitution maintains existing revenue
allocations and championship opportunities for each division, locking in 4.37%
to Division II and 3.18% to Division III -- percentages that have been in place
since January 1996. Each league has the oversight of its own budget,
expenditures and distribution to its members.
The final version of the constitution also emphasizes
athletes' physical and mental well-being, along with prioritizing diversity,
inclusion and gender equity.
The push for sweeping change to the NCAA's governance comes
after a tumultuous summer in which the organization suffered significant legal
and political losses. In June, the Supreme Court of the United States
unanimously affirmed a ruling that allowed for an incremental increase in how
college athletes could be compensated. In July, a flurry of state laws made it
illegal for schools and the NCAA to punish college athletes for making money by
selling the rights to their name, image and likeness.
Many throughout college athletics had said they hoped the
new constitution would simplify what they considered a complex and outdated
rulebook by transferring authority from the NCAA's national offices to the
conferences and their schools. The previous 43-page document has been boiled
down to 20 and gives each of the three divisions more freedom to govern
themselves.
BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week to Karla Bonoff (70), Sandy Koufax (86), Maggie Smith (87), Denzel Washington (67).
CHRONICLES OF HIGHER EDUCATION – Hurricanes are blowing over
American universities — blustery winds of ideological disagreement, political
distrust, and lots of anger over racial injustice and the marginalization of
subordinated groups, all fueled and fed by social media. Under such intense
pressure, senior administrators are making mistakes.
One such storm touched down recently at Yale Law School.
Trent Colbert, a second-year law student, sent an invitation to classmates
announcing a “trap house” party cosponsored by the Native American Law Students
Association and the Federalist Society to celebrate Constitution Day. Some
found the email — with its use of the phrase “trap house,” its mention that
Popeyes’ chicken would be served, and its reference to the conservative
Federalist Society — racist and offensive. Students complained, and
administrators responded by privately pressuring Colbert to apologize and
publicly condemning his email as racist. The administrators were in turn
condemned for their response — their conduct labeled cowardly, incompetent,
deplorable.
Administrators are caught in powerful crosswinds that make
it likely that even the best ones — perhaps especially the best ones — will
make bad decisions.
Yale is not unique. Storms have touched down in recent years
at the University of Southern California’s Marshall School of Business,
Georgetown Law, University of Illinois at Chicago School of Law, and the
University of Michigan at Ann Arbor, to name just a few. The fact patterns are
similar. Something happens — in class, on a final exam, or outside of class —
that students find racist or otherwise offensive. Students protest — they
demand statements of condemnation, swift action and public accountability.
Administrators respond — they condemn, they punish, they disavow — and they do
so quickly. Administrators are then pilloried — for overreach, for trampling
academic freedom, for moving too quickly, for getting the facts wrong.
NHL CHRISTMAS BREAK – Rink Rats Power Rankings:
1. Tampa Bay
Lightning (21-7-4)
2. Carolina
Hurricanes (22-7-1)
3. Florida
Panthers (20-7-4)
4. Toronto
Maple Leafs (20-8-2)
5. Vegas
Golden Knights (21-12-0)
THE SWAMI’S WEEKEND PICKS –
NFL Football Pick of the Week – Sunday 1/2, 4:25 PM (EDT),
Fox: Arizona Cardinals (10-5) vs. Dallas Cowboys (11-4). Both teams will make
the playoffs and go no further. Cowboys
win 24 - 14.
2021 Season to Date (51-36)
Goodbye 2021. Don’t let the door hit you in the Covid!
Next Blog: 2022 What next???
Until January 10, 2022 Adios.
Claremont, California
December 31, 2021
#XII-6-443
3,141 words,
eight-minute read
CARTOON OF THE WEEKEND –
RINK RATS POLL – 2021 …
___ forget it.
___ a great year.
___ let’s move on.
___ a horror show.
QUOTE OF THE MONTH – “We need to stop just pulling people
out of the river. We need to go upstream and find out why they’re falling in..”
– Desmond Tutu
Rink Rats is a blog
of weekly observations, predictions and commentary. We welcome your comments
and questions. Also participate in our monthly poll. Rink Rats is now viewed in
Europe, Canada, South America and the United States.
Posted at Rink Rats The Blog: First Published – May 3, 2010
Our Eleventh Year.
www.rhasserinkrats.blogspot.com
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