Here's looking forward to freedom in 2021
We often talk about the pent-up demand for goods created by the pandemic. But don’t underestimate the pent-up demand for physical freedom and to the investment opportunities that come with it.
The tree is up. The hall is decorated. The presents are wrapped (sort of). There are eight boxes of crackers. I have just taken delivery of a 4.6kg turkey. We are ready. But for what exactly? Turns out no one is coming this year. And we aren’t going anywhere either. This is not the end of year we expected when we sent out 2020’s first issue in January. Then we were worrying about stockmarket valuations and shifting cash into commodities, which we thought might be at the end of their vicious ten-year bear market.
The future turned out to be as unco-operative as usual. There was no way to know in January that a pandemic would close the world; that democracy would be effectively suspended across the West; that markets would hit new highs amid both a supply and demand crunch; that fiscal and monetary policy would merge into one great stimulus machine, rendering valuations irrelevant; that the main press topic in Christmas week would be the great festive lettuce shortage; and that I would hit 26 December with 3kg of excess turkey to fricassee.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
My own thoughts on 2021 will be familiar to regular readers. I think it will be pretty good. Vaccine roll out is faster than I expected (we are heading for one million a week), which should see the economy open faster than expected (when rising cases no longer equate to rising deaths, lockdown has to end). We are likely to see a wave of productivity as firms integrate all the technological lessons of 2020. All this will happen amid an ongoing wave of stimulus. Perhaps most importantly of all, the UK savings rate is still high – households have cash to burn. Where will it go?
Here is where I think the miseries of the investment world might be surprised. Think about what you most want to do right now. I’ll tell you what I want to do: drive and fly. And as soon as I can, that is what I will do. I will drive all over the UK seeing my family. I will take planes to all the places I want to go – Greece, Florida, Iceland and perhaps even to Japan for the Olympics (Japan last hosted the Olympics in 1964, a year that marked its shift from enemy country to global economy – see this week's magazine for why 2021 could be another good year in Japan). I won’t be alone. We often talk about the pent-up demand for goods created by the pandemic. But don’t underestimate the pent-up demand for physical freedom – and the oil, airlines, restaurant seats and cars that will be needed to fuel it. Here’s looking forward to the renewal of our commitment to that freedom in 2021 – and to the investment opportunities that come with it. A very happy Christmas and New Year to all our readers.
Our first issue of 2021 will be with you on 8 January.
-
‘Sandwich generation’ carers losing £6,000 a year to support elderly relativesMiddle-aged adults are often caught between caring for children or grandchildren and their elderly parents, leaving them taking time out of the workforce and facing a huge hit to wages while they are still trying to save for retirement. We look at the true cost of caring.
-
Ground rents to be capped at £250 a year – what does it mean for you?The government has published draft legislation which would see ground rents capped at £250 per year for leaseholders. We examine what it means for homeowners and the housing market.
-
What turns a stock market crash into a financial crisis?Opinion Professor Linda Yueh's popular book on major stock market crashes misses key lessons, says Max King
-
ISA reforms will destroy the last relic of the Thatcher eraOpinion With the ISA under attack, the Labour government has now started to destroy the last relic of the Thatcher era, returning the economy to the dysfunctional 1970s
-
Nobel laureate Philippe Aghion reveals the key to GDP growthInterview According to Nobel laureate Philippe Aghion, competition is the key to innovation, productivity and growth – here's what this implies for Europe and Britain
-
'Investors should brace for Trump’s great inflation'Opinion Donald Trump's actions against Federal Reserve chair Jerome Powell will likely stoke rising prices. Investors should prepare for the worst, says Matthew Lynn
-
The state of Iran’s collapsing economy – and why people are protestingIran has long been mired in an economic crisis that is part of a wider systemic failure. Do the protests show a way out?
-
Hiring new staff for your business? Help is availableHiring more employees is a costly business, but help is available from the government, says David Prosser
-
'Expect more policy U-turns from Keir Starmer'Opinion Keir Starmer’s government quickly changes its mind as soon as it runs into any opposition. It isn't hard to work out where the next U-turns will come from
-
Why does Donald Trump want Venezuela's oil?The US has seized control of Venezuelan oil. Why and to what end?
