19 July 2021

Today has been trailed for weeks as “Freedom Day,” when life in the UK was going to return to normal. Well, it didn’t quite work out that way, as measured cases are still quite high and the badly designed “NHS Covid” app has wreaked havoc by ‘pinging’ workers who have no symptoms, are fully vaccinated but might have come withing bluetooth range of someone who has potentially been infected.

As far as I can see, the app has been an unmitigated disaster, and has made a negligible contribution to suppressing transmission of the virus, but it’s easy to see why the cabinet grasped at a shiny new piece of vapourware as the answer to all its prayers as the scale of the pandemic became apparent in the first quarter of 2020.

Markets swoon

We had some strong classic risk-off behaviour today:

• commodities all down, oil by 7.5%,
• bonds jumping, 10Y yield now 1.18%,
• nearly all equity markets slumping by more than 1%,
• USD.JPY dropping by > 0.5%,
• Bitcoin down 3.8%.

It’s really not entirely clear what has driven this, other than sheer old age of the bull market. Tomorrow is very hard to call. As usual, the most likely outcome is that prices rebound a bit, but it’s hard to say as the down trend is getting some legs now. People are spending some of the massive rise in their net wealth, even the very rich with their famously low propensity to spend.