Editor's letter

Are we losing the moral high ground on Covid?

Not only must we never see more than five other people at the same time, we must report those who do to the police, says Merryn Somerset Webb.

At the very start of the pandemic, on a plane from somewhere to somewhere, I pulled a furious article out of the China Daily. The author was maddened by criticism of Chinese handling of Covid. The New York Times had accused it of “Mao Style Socialist Control”; Foreign Policy had gone for plain old “Incompetent”; and China Uncensored for “Authoritarian Crackdown”. But as far as the paper was concerned, the criticism was all about the West running a xenophobic anti-China campaign “because they really want you to hate.” 

I kept it, then, as a reminder of just how Chinese and US relations were breaking down. But now it is also a trying reminder of how much less of the moral high ground the West is hanging on to than it was even in March. We aren’t exactly welding people into apartment buildings here. But there’s a nasty precedent in being told that not only must we never see more than five other people at the same time, we must report those who do to the police. So are we doing things the right way? 

Time will tell of course. But part of the answer could come from James Ferguson’s analysis of the testing data in this week's issue. The other part might be about the damage caused by lockdowns: as James notes on our podcast this week, maybe we should stop talking about how Covid is wrecking lives and economies and start talking about how the response to Covid is wrecking lives and economies – turn to the best of this week's columnists page for the nightmare effects of lockdown on much of Africa. 

The idea that we are perhaps worrying a little too much about Covid is seconded by the latest Bank of America Global Fund Manager Survey. A second wave remains the biggest worry for managers. But it is being fast caught up by concerns about global trade wars (very valid – see above!), the US election and the rising odds of a “systemic credit event”.

There are also two new entrants to the worry list this month – inflation and a new tech bubble, both things I suspect MoneyWeek readers have (quite rightly) had on their worry list for some months now. We still worry about tech valuations but we don’t think the market as a whole is in bubble territory: the median price/earnings ratio of the S&P 500 is 17.5. Not cheap – but not a bubble either.

Elsewhere there are opportunities aplenty (but avoid pigeons – see this week's "Great frauds in history"). China is booming (for more, turn to the markets pages). And even after the extraordinary recovery since March, the shock of the pandemic has left some pockets of value. This week, we also look at how to invest in the end of oil – there will be a wave of money pouring into anything remotely green post-pandemic.

Want to feel good and make money at the same time? Here’s your chance. If the former is less important to you than the latter, look to the end of that story: we are only at the beginning of the end of oil so perhaps you should not entirely neglect the old industry players. 

Finally for the genuinely contrarian, Matthew explains why to start buying Carnival on this week's Trading page. Cruise ships are pretty filthy (they mostly burn heavy fuel oil) and about as Covid-unfriendly a business as any. But, says Matthew, Carnival’s finances are pretty shipshape – and people will cruise again. They may even go back to their offices again – quite soon. Particularly if James turns out to be right, and normalisation is nearer than we think.

Recommended

Gold has been incredibly boring to own – but that’s no bad thing right now
Gold

Gold has been incredibly boring to own – but that’s no bad thing right now

Stocks, bonds and cryptocurrencies have all seen big falls this year. But gold remains at its one-year average. It may be dull, but it’s doing what it…
29 Jun 2022
A UK-listed multinational engineer with strong growth and rising dividends
Share tips

A UK-listed multinational engineer with strong growth and rising dividends

Spirax-Sarco is a world-leading engineer making consistent progress in three niche markets, with an order book at an all-time high.
29 Jun 2022
Indulge your wild side with a safari in deepest Kent
Travel and holidays

Indulge your wild side with a safari in deepest Kent

Get up close to the animals at Port Lympne Hotel and Reserve, says Matthew Partridge
29 Jun 2022
How to find the best dividend stocks
Income investing

How to find the best dividend stocks

Stocks that pay dividends tend to outperform the market over the long run - as well as providing an income. Here, Rupert Hargreaves explains the best …
28 Jun 2022

Most Popular

Market crash: have we hit bottom or is there worse to come?
Stockmarkets

Market crash: have we hit bottom or is there worse to come?

For a little while, markets looked like they were about to embark on a full-on crash. And that could still happen, says Dominic Frisby. Today, he look…
27 Jun 2022
Interest rates are rising, here are the best savings accounts on the market
Savings

Interest rates are rising, here are the best savings accounts on the market

With inflation at more than 9%, your savings are not going to keep pace with the rising cost of living. But you can at least slow the rate at which yo…
24 Jun 2022
Prepare your portfolio for recession
Investment strategy

Prepare your portfolio for recession

A recession is looking increasingly likely. Add in a bear market and soaring inflation, and things are going to get very complicated for investors, sa…
27 Jun 2022