A Rough & Tough Year 2022 – Stocks Plunge, Oil Drops, Cryptocurrencies Tumble And Pessimism Skyrockets

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Jan 21 2022
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As Covid-19 pandemic enters its third year, people are increasingly getting pessimistic about what’s in store in the year 2022. In the first year of the outbreak (2020), most thought the Coronavirus would be a temporary hiccup. When vaccines were developed – and rushed to the market – people thought the worst would be over soon, giving high hope for the year 2021.


In June 2021, as the number of Americans vaccinated against Covid grows, more than 4 in 5 adults believed the situation was getting better. However, after the Delta variant emerged in July, the optimism dropped like a rock. By October, at least 51% people thought the situation was improving as infections from the Delta dropped. But in November, Omicron dashed those hopes.


Entering 2022, only 20% Americans said the situation is improving, with 22% think it remains the same while 58% believed it is worsening. The good news is the attitude toward social distancing and masking in the public has become more positive. Interestingly, an increasing number of Americans have curtailed indoor dining at restaurants as part of efforts to avoid large crowds.

Year 2022 - Wall Street

The overall pessimism has consistently affected the financial markets. On Thursday (Jan 20), early optimism didn’t last long after the Dow Jones Industrial Average dropped 313.26 points, despite having skyrocketed more than 400 points earlier in the day. Crucially, the 30-stock average closed below its 200-day moving average for the first time since December 2021.


Compared to its record set in November, Nasdaq has lost more than 10% – indicating a technical correction. But the Nasdaq Composite entered further correction territory after the index plunged 1.3%, when it was up by 2.1% earlier on Thursday.  Likewise, the S&P 500 tumbled 1.1% to 4,482.73 and closing below 4,500 for the first time since October 2021.


For the week alone (Monday till Thursday), the Dow is down 3.3%, while the S&P 500 has lost about 3.9%, follows by Nasdaq – the biggest loser that had lost 5%. In fact, S&P 500 is looking at its third straight week of losses. The declines in the Wall Street saw Asia-Pacific markets fell accordingly – from Singapore to South Korea and from Australia to China.

Coronavirus - Covid-19 Pass Baton from 2021 to 2022

Even oil prices dropped 2% to US$86.63, slipping from their 2014 highs on Wednesday. Cryptocurrencies such as Bitcoin plunged by more than 7% to about US$38,500, tumbling over 40% since November from a high of over US$67,500 in 2021. Bitcoin, a common investment to hedge against rising inflation, has become a risky instrument as the 10-year U.S. Treasury yield spiked earlier this week.


To make matters worse, unemployment data released on Thursday suggested that the surge in Omicron could be hurting the economic recovery. Against Dow Jones estimate of 225,000, the jobless claims for the week ended January 15 spiked to 286,000 – the highest level since October last year. It certainly didn’t help that home sales are also dropping.


Investors largely lost confidence due to fears about the Federal Reserve’s pace of monetary policy tightening and weaker-than-expected earnings from companies. For example, disappointing subscriber growth at streaming giant Netflix immediately sent its share price tumbling nearly 20% late on Thursday. For now, markets expect at least four rate hikes this year.

Federal Reserve - Building

However, as investors anxiously wait for the Federal Reserve’s FOMC meeting next week for details on how it plans to tackle high inflation, financial markets were not impressed with comments made by U.S. Treasury Secretary Janet Yellen on inflation. She said – “I expect inflation throughout much of the year – 12-month changes – to remain above 2%.”


Like it or not, despite rosy pictures painted by certain politicians (didn’t they say 2020 was just a hiccup and 2021 would be a recovery year?), this year will be equally rough and tough. Inflation will drive up interest rates across Europe, Asia, Latin America and almost everywhere, meaning a higher cost of servicing debt would put pressure on everyone with a bank loan or a mortgage.


After two years of disappointment (2020 and 2021), some have already anticipated another year of trauma and uncertainty. Some actually felt 2021 was worse than 2020. According to a study done by Boston University, low-income people were 7 times more likely to experience depression symptoms thanks to prolonging pandemic. And this is why pessimism has been on the rise.

Coronavirus - Covid-19 - Pessimism at Airport

Days ago, Israeli’s Sheba Medical Center found that a fourth booster was only partially effective in protecting against the Omicron strain. It means while a fourth shot of Moderna or Pfizer-BioNTech Covid-19 vaccine boosts antibodies to even higher levels than the third jab, but it is not enough to prevent Omicron. What if another new variant were to emerge this year?


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Not all countries are raising rates. China is cutting rates.

It’s always lovely to begin the new year with new miserable news even while we struggle to digest and deal with the old miserable news from last year still very much with us, and still happily cursing our jinxed kiasu and kiasi and errr everyone else cursed to be Bolehlanders.

Actually, we have been on course to suffer enormous economic difficulties except that we knew not how much worse that’s going to be from the hopelessly bad.

We should therefore be grateful we are reminded of the doom and gloom predicted even for last year. Except that the doom and gloom are of a gloriously darker shade, wan that hovers confidently around actual death. For Bolehland, it can also be the death of history, a Francis Fukushima than Francis Fukuyama, it’s got nuclear!

It may be dire predictions from the West of their economic turmoil and more doom and more gloom to come to their world, but the tsunami of the effect of what will really hit them hard will, as always, hit us too – and even harder, Amen!

So, as usual, my kind advice for our kiasu and kiasi monkeys would be to continue with their panic over Covid and add the new flavours for the increased panic over the economy and assorted fearful issues like possibly inflation, definitely unemployment, bankruptcies, and all the rest of it all. There would be new flavours of Covid too, some possibly worse than the flavours we are still struggling with – which could still get worse with our gomen’s gross inability to manage them.

We have been told to live with Covid, though with Bolehlanders plenty have died with it instead. But we should while we almost live through sheer fear and utter pessimism, look at the bright side of things. We can escape the fear if Covid gets us first and finish us off, we need not suffer the severe economic downturn. And if the economic downturn gets us first, many will perhaps end it all – thus avoid the worse Covid can wreak.

If you are stoic in your outlook, you may want to weather both Covid and the economic downturn, and soldier on. That would be sensible thinking, staying alive regardless is triumph of the human spirit. However, in Bolehland, we have always a gomen that can kill you before either Covid or the destruction of our economy can. Remember we’ve always had the luck of our cursed and fcuked up gomens (and opposition politicians), whatever the “quality” and “qualifications” those have, the guaranteed constant is they will find their blessed talent and their naturally-endowed ways to kill us and country off as that’s the only thing they can do best.

Anyway, if you are Chinese, see yourselves through at least for the Chinese New Year, don’t do anything drastic – unless you are hounded by lots of creditors, worse still, Ah Longs. If the kids ask for angpows, tell them to fcuk off! Burn your money in a good firework instead. If it is going to be your last firework before the Ah Longs or the thieving banks get you, do a great big firework.

The new year is going to be bloody awful for all according to the astrologers, fortune-tellers, fengshui masters, and the trance dancers, doesn’t matter whether you are dragon, tiger, pig… or chicken. There will be calamities, floods again, lots of rain, and extreme heat – if the temperature goes up another half a degree we would be pretty much buggered. It means plants would die, there will be serious shortage of food – which means migration, wars over food.

But the shortage of water would get us first so we have to kill each other over that first. But then again, animals are smarter than Bolehlanders so we might end up their food. Imagine being eaten by Peppa, Miss Piggy, and all those..! Imagine the oinks raiding mosques and such like… I dread to imagine what that would be like… You won’t dare ask for your piggyback nor say you stole from a piggy bank. You can say you don’t eat pork but don’t call pigs dirty! Anyway, I am just painting a scenario for what can happen in a really bad year.

Enjoy and get over your new year bash first, there’s one whole bad year ahead for you to be thoroughly miserable, panicky, pessimistic, kiasu and kiasi about, every day is a bad day.

And the worst is forever round the corner…

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