For wealthy countries with progressed (but not complete) vaccine roll-outs, it is time for governments to think fresh.
The main remaining challenge is that young cohorts are not yet vaccinated, and not as afraid of COVID as the older more vulnerable cohorts.
What to do???
Given that the young can give the virus to the old and start new waves, governments have a strong reason to push vaccinations hard for all ages, to avoid future hospital pressure (and avoid long-covid issues), and to avoid economic damage from fresh lockdown steps.
The economic cost (alone) of lockdowns is so dramatic that it is a good investment to offer incentives, even if they do cost something.
Now that governments finally have plenty of vaccine supply (from the US to EU, and other countries too), it is time to consider the best incentives. Supply is no longer the binding constraint.
It could be funky to offer incentives that would also help the reopening progress (including hard hit sectors):
At the macro level, such incentives will cost almost nothing compared to what can be saved from having the economy fully recovery just a bit faster.
it is time to think out of the box...
This has already been happening to some degree in the US (free beer for shots, lottery tickets) and it is time for @vonderleyen and co in the EU, and other officials around th world, to consider innovative steps too.
What would you suggest as the most effective step?
I will leave it at that. We do not know if the summer waves (such as the EU one) will have significant health effects. But if the young cohorts were more fully vaccinated, it would probably eliminate any remaining uncertainty, and put us on a quick path to blissful normality
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Seigniorage is just one aspect. But a dimension that is easy to quantify. El Salvador derives no government income from 'money printing'. Most other countries, with their own independent currency, do.
This is relevant to the 'who is next' q, and will likely exclude a long list.
"normal' countries, with their own currency, can generate government revenue from their 'money printing activities'. El Salvador had to move to a dollarized system years ago, and is therefore not comparable to those with independent monetary policy.
Tomorrow, was supposed to be the day of final reopening in the UK. But the delta variant has made policy makers more cautious, and there is now an expectation of a delay.
What is the data saying? How bad is it?
In the global picture, the UK stands out as the only European country with significant case growth.
Cases levels are still far from peak, but we have seen 2-3 weeks of >50% week-on-week growth now.
And levels are now 300% of what they were 3-4 weeks ago
Still, hospitalizations are growing more modestly. Focussing on England, they are up 50% over the last 3-4 weeks, and still at very moderate levels compared to past waves.
There has been a lot of focus this week on El Salvador becoming the first country in the world to adopt bitcoin as legal tender
Is it a good idea?
Quick thread (currency risk angle)
Unsurprisingly, many hard core crypto folks have celebrated the step, as a harbinger of a global trend towards broader adoption of bitcoin/crypto (freedom even).
The piece by @DanielAlpert got me thinking a bit about US exceptionalism, as it pertains to the labor market, and the role the unemployment benefits may play.
Which country stands out in this chart?
=> some observations on income distribution and labor supply...
This is simply OECD data that tell you what percentage of jobs is less than 2/3 of median earnings.
The US is 23.4%
Belgium,N.Zealand,Finland,Italy,Denmark,Portugal all <10%
The US has an awful lot of low paying jobs (in a relative sense, but also relative to cost of living)
You can argue. 'but US is a wealthy country, and if the median is high...'. But what about the food stamps then. They would not be needed if the absolute level was fine.
There used to be little correlation between crypto and global markets in general. But the sell-off in Nasdaq futures overnight does look (very and unusually) correlated to the breakdown in crypto space
[here illustrated with BTC (green) and ETH(yellow), vs Nasdaq (white)]