It looks like the 2+ years of Covid is finally over. S’pore is open for business as usual and ramping up aggressively.
The annual F1 night race happened last weekend with the largest crowd ever. There were about 302,000 who attended, making it the biggest turnout ever in its history. 49% were overseas visitors. Just before the weekend, 30+ MICE (Meetings, Incentives, Conferences, Exhibitions) events were held to take advantage of the F1 races.
There was so much pent-up demand for travelling to S’pore that hotel prices shot up to pre-Covid levels. One visitor even provided the cost breakdown of his one-week stay here. It was USD$30k and consisted of hotel accommodation, F1 tickets and Michelin-star restaurant meals.
It was inevitable that a Covid surge would happen after the event but that was a calculated risk the authorities took as being acceptable. It shows to the world that S’pore is open for business and we are back to normal now. A relaxation of restrictions was also announced today with a vaccine booster strategic plan going forward.
We see the same actions happening everywhere around the world except for China. Even HK is targeting to stop quarantines for overseas travellers soon. Japan is on target to welcome tourists for its winter season. Covid is totally behind us now.
The virus has mutated from a deadly version like all other viruses into a less severe version in order to stay alive and not kill the host. Just like the common flu, there will be constant mutations which will require optional flu shots periodically. Even the newer Omicron mutations are getting milder and probably 60-70% of the population had already contracted the virus at least once to gain antibodies against future strains.
We are back to concentrating on other events that are of concern to us again. There are a lot of event risks happening into the year-end which is still causing high volatility in the markets. I will highlight the top 3 below and the likely scenarios to be played out.
The elephant in the room is the ongoing Russian invasion of Ukraine. It has resulted in multiple secondary effects on the world economy with its many moving variables. The outcome is mostly uncertain but we can clearly still see ahead that Europe is heading into a miserable winter with possible gas shortages if winter proves to be colder than expected, thanks to climate change.
While European countries are trying to stock up supplies ahead of the winter, they are also looking to other sources of energy like coal and nuclear power plants which they have been trying to limit and reduce in recent years. The new UK government is also proposing a household cap on energy costs for 2 years while Germany had taken over some Russian assets within its borders.
The recent mysterious explosions at the Nord Stream pipelines in the Baltic Sea in late Sep also add to the problem. All fingers point to Russia for the sabotage but some conspiracy theories blame it on US covert ops. They think the US wanted to ensure that the European countries do not have the option to blink under pressure to negotiate with Russia later.
Oil and gas prices should remain firm to higher, no thanks to OPEC’s announced cut in production at these critical times. Europe will be in for a rough ride into Dec/Jan. It will only subside if the Russian/Ukraine war ends. But things are getting worse for Putin and he threatened the nuclear option. This limited nuclear response has further heightened the tension for everyone.
The next event risk is the US mid-term elections which are about a month away. Initially, the Republicans seemed to have the upper hand. But they managed to shoot themselves in the foot with the overturning of Roe vs Wade plus a lineup of incompetent candidates that lie like the orange one.
It will be a close call here according to the polls. But I think the Democrats should maintain their majority given the anger of the majority with the actions of the GOP recently. With a 06 Jan hearing this Thurs, we will see more of the Trump shenanigans than happened on that fateful day.
Finally, the last event risk is from China. Come 16 Oct, the meeting will begin where Xi is likely to be re-elected for his 3rd term. Hopefully, once that is over, China will return to its pragmatic ways to review the economy and allow tough Covid restrictions to ease.
This could spur its domestic economy to rev up again and that will be good for global supply chains to function effectively again. Chinese stocks have been beaten up for a while thanks to Covid, the US/China conflict and Xi’s actions to regain control of its economy again. China’s blue-chip stocks have all collapsed as a result.
The US dollar will continue to strengthen as the Fed resume its rate hike of another 75 bps into the next FOMC meeting in Nov. Economic numbers show strength in job numbers and inflation remains elevated.
We are all looking into an interesting and explosive 4Q. The subsequent weeks might spring more surprises. One should stay nimble and only trade in the high-probability trends instead. Long gas futures and buy USD against other currencies that lack the resolve to hike rates.
On the personal front, my new consultancy project started in Oct. With regards to the 10-week full-time course I was supposed to start on 17 Oct, it was abruptly cancelled by RISE 2.0 as they could not form a class. Seems like the demand for part-time is more popular as the economy improves and there are more job vacancies. I was given the opportunity to join the part-time course or wait till early 2023. As the schedule for part-time does not suit me, I have decided to wait it out till next year. But chances look low that they can get the numbers to start a full-time one in Jan though.
I now have a lot of time on my hands till year end and am looking at my 2022 to-do list to fill it up. One of them will be to improve my video editing skills and try new software like Adobe Premier Pro. I might even try to get certifications for Microsoft Power BI to learn more about cloud computing and data analytics tools.
The family is meeting up in France for the last 2 weeks of Dec for a Christmas break. I will have the time to start planning the agenda now 😉
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