Vaxxed or not, data suggests people are over Omicron/Delta, and COVID altogether

·Editor focused on markets and the economy

Fri, Dec 10, 2021, 3:04 AM5 min read

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Thursday, December 10, 2021

'Learning to live' with the virus has become a credo

Last Sunday, after nearly suffering a heart-attack watching Pittsburgh play Baltimore in a classic Steelers-Ravens thriller, I attended my first concert of the pandemic era: Genesis, which played to a packed-to-the-rafters crowd at Madison Square Garden.

Tomorrow afternoon, I’ll be indulging in yet-another COVID-era first that’s also been on my personal bucket list for years. I’ll be watching the Black Knights play the Midshipmen in the annual Army-Navy game.

I’m also an entertainment junkie who’s in the movie theater at least once a week, and I’m known to dine indoors — a LOT. And it bears mentioning that all of the above, at least in New York City, require full vaccination (in the interest of full disclosure, I am).

Believe it or not, my reason for sharing this information is not to boast about my social life, or virtue signal about vaccinations. It's meant to illustrate an important point about the virus and human behavior, which have played an integral part in propelling the economy for the better part of the last two years.

The appearance of the Omicron variant of COVID-19 rocked markets, which up until Thursday’s retreat that squashed a 3-day rally, had recouped nearly all of its gains — a reversal so dramatic investors had begun dismissing it as “Omi-whatever.”

It's still very early days and caution is advised. Yet signs, including price action in major markets, are pointing to the variant being less fatal, even if it's significantly more communicable than Delta. Case counts are already jumping everywhere — even among highly vaccinated populations — so more restrictions on public life (or the unlikely but still non-zero probability of full-on lockdowns) can’t be entirely ruled out.

But with all that being said…

Amid the battles breaking out over vaccine mandates and the impact on those who have chosen not to be inoculated against COVID, there’s strong evidence to suggest that people are “over it,” as the kids say these days.

None of this is meant to dismiss the toll the virus continues to take on the globe, where the death toll has spiraled inexorably higher (over 5 million worldwide and counting), even with the presence of vaccines. To be sure, there are many with underlying conditions, or loved ones considered high risk, who are still cautious or outright paranoid, and with good reason.

Yet evidence everywhere suggests that vast numbers of people — and not just the mostly maskless hordes gathered to watch Phil Collins and Company at the Garden — are moving beyond living in self-imposed exile to a strategy of risk assessment and mitigation. Holiday gatherings, including office parties, are starting to look a lot like they did pre-COVID.

To wit:

Just before Thanksgiving, air travel hit the highest levels of the pandemic era;
In the metropolitan New York/New Jersey area, ridership on public transportation has rebounded sharply as workers slowly return to offices and make their way to events, (although still below pre-COVID levels).

2/2

If there is one metric that summarizes New York City's rebound from COVID, it might be subway usage.

As the next chart shows, they have a long way to go. pic.twitter.com/ULansD9cqV
— Jim Bianco biancoresearch.eth (@biancoresearch) December 6, 2021

And all over the world, more people are getting out and about. Global mobility data from Deutsche Bank “suggests that on a population-weighted basis, most of the world is back close to pre-pandemic levels of mobility,” the bank said in a research note this week.

People are moving about their respective countries, and the world, at an increasingly rapid pace. (Deutsche Bank, Google)

“As the winter COVID wave and Omicron hit us, in aggregate mobility hasn’t yet dipped,” chief economist Jim Reid wrote. “This either shows people are learning to live with the virus more or that it’s too early to tell as travel and domestic restrictions, only very recently imposed, have yet to fully take their toll, with more possibly to come.”

Perhaps, but the “learning to live” aspect is what is most important to understanding why stocks have recouped their losses from the “Black Friday” sell-off. In fact, Matt Roberts, newly publicly-traded Vacasa's (VCSA) CEO, told Yahoo Finance's Alexis Christoforous this week that bookings continue to outperform, even with Omicron swirling.

"We posted amazing Q3 results when the Delta variant was spiking. It's partly because we're domestic focused and whole homed. So, if anything, we are quite insulated from any new variants," Roberts said.

The rise of new variants is a very real risk. Yet all the high frequency data that continue to defy expectations, especially those showing how hot the labor market remains, suggest that demand is sky high. That means even people fearful of COVID are still coming out of their bubbles.

“The response to Omicron may dampen the economic outlook in the near term,” wrote Thomas Torgerson, co-head of sovereign ratings at DBRS Morningstar, in research this week.

“At present, we view these risks as contained and unlikely to derail the global economic recovery as consumers and businesses continue to adapt and learn to live with the risks,” he added.

For many (but certainly not all), "learning to live" with COVID has become something of a credo. So whether vaccinated, unvaccinated, or just plain over it (I count myself firmly in the latter camp), people are weighing the risks, but seem to be erring on the side of enjoying life’s creature comforts.

Oh, and Go Army!

By Javier E. David, editor at Yahoo Finance. Follow him at @Teflongeek