Private Wealth

Weekly Research Briefing: Act One

February 08, 2022
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If one was going to write a script for the Fed to raise rates by 50 basis points at the upcoming March meeting, last week's jobs, inflation, and economic data would have provided the perfect opening act. Get Robert Duvall and his yellow bandana ready because he already knows the line, but we just have to change one word:

[The Doors "The End" plays in the background.]

Duvall: Smell that? You smell that?
Global Central Bankers: What?
Duvall: Covid, son. Nothing else in the world smells like that. I love the smell of Covid in the morning.

Yes, the economy is so strong that even Covid could not hold it back. While a record number of people missed some days of work in January because of it, many more found new jobs and returned to work. And as Covid new cases fall to significantly lower levels, expect kids to be fully engaged in school and day care, and grownups to return to the factory, office and laptop. January's strong jobs numbers combined with the previous month's revisions and the jump in average hourly earnings to a 5.7% rate sent the fixed income markets into a tailspin as investors quickly factored 5-6 Fed Fund rate increases into their 2022 models. They also began to take serious bets on a 50 bp hike at the March meeting. None of this was in last year's script. Also adding to angst in the more energy-centric economies, like Europe, is a new seven year high in crude oil prices. The ECB even threw up some yellow flags last week as they increased their hawkishness to fight rising inflation. If you thought the moves in the U.S. fixed income markets were wild last week, check out any note or bond that trades in Euros.

Big earnings began to wind down last week, but it wasn’t without some Meta-excitement. We finally learned the root cause for the last six months of underperformance at Facebook/Meta Platforms. Sure, their user growth flattened and all the kids were using TikTok, but the real key was that Apple picked up all the marbles and went home. Now you know why Facebook/Meta was so driven to get into a virtual world and leave mobile phones behind. Luckily Amazon, Google and several other big names kept the Nasdaq and NYSE from melting down. Plenty of great earnings releases away from Meta and Clorox to look into for investment if you have to own public stocks right now. The rest of the market continues to trend on: financials like higher interest rates, energies like higher oil prices and travel and leisure names like the rapid wind down of Covid. The Ukraine situation is still there and is a worry, but a very difficult one to hedge or bet on. I will stick to looking at what I have data on.


Americans are going back to work and last week's data shows it...

Record high upward revisions to initial job growth estimates in late 2021

Financial Times


Wells Fargo lays out the better-than-expected data last week and also highlights that Americans are returning to the workforce at increasing speed...

Nonfarm payrolls rose 467K in January, which was not only nearly four times the consensus estimate, but way ahead of any forecast, which ranged from -400K to +250K. What's more, over the past two months, payrolls were revised up 709K. With these jumps, payrolls now remain less than 3M (-1.9%) under their pre-pandemic levels and are within grasp of what could be seen by the Fed as "maximum employment". This milestone was even more impressive, given the downward benchmark revisions that accompanied the release. Entering today's report, workers on sick leave were a hot topic, and indeed, the household survey showed a whopping 3.6M workers were out sick in January during the survey week, but that wasn't enough to weigh on the overall gain. Furthermore, the unemployment rate ticked up to 4.0% in January from 3.9% the prior month, but notably, the move came from an encouraging increase in the labor force participation rate to 62.2%. A persistent struggle over the past year has been workers not re-entering the workforce, and January's participation rate marks a pandemic high, and the largest monthly gain in over 18 months. While one month isn't a trend, higher participation even in the face of Omicron-related headwinds is promising. Average hourly earnings jumped 0.7%, which, along with January's strong job growth, will likely reassure even dovish FOMC officials that their hawkish pivot was warranted.

Labor Force Participation Rate

Wells Fargo


What Are LPs Talking About?

Read our latest article


January is the month that made covid a lower-case word...

Tweet from @jasonfurman

Plenty of January absences from the flu named omicron...

@bencasselman: More than 3.6 million Americans were absent from work due to illness in January, more than at any prior point in the pandemic. That's more than 2% of the *entire* workforce.

Share of employed workers absent due to illness

Unparticipating workers are finding it easier to return to the workforce...

We break down where the missing 2.5mn workers come from in the Great Resignation. First, many people (~0.8mn) appear to have retired early, benefiting from rising home equity in a hot housing market. But this still leaves 1.7mn people who are not retired but still not working -- an available pool to relieve the US worker shortage. And we forecast that about 1 million of these people will return to the labor force this year, as virus spread falls, antiviral pills reduce health risks, and fiscal transfer payments-driven savings are exhausted.

The Labor Force Participation Rate

Goldman Sachs


But no doubt that some non-workers have no plans to return to work as their number one asset is making them feel very flush right now...

US household equity ownership

@Lvieweconomics


The Fed is watching wages closely...

Last week's jump along with several corporate earnings comments got the market even more convinced that rate hikes are coming sooner...

US average hourly earnings

@LizAnnSonders


This sent the odds of a 50bp rate hike in March to a one-third probability...

probability

Jones Trading


Five 25 bps rate increases this year are now fully priced in, with the possibility of six increases on the rise...

Implied Fed Funds rate

TheDailyShot


As a result, the two-year yield is now moving higher by double digit basis points per week...

US 2yr Government Bond Yield

TheDailyShot


Is the 10-year Treasury yield about to lose its '1' handle?

CBOE 10-Year US Treasury Yield

@WalterDeemer


If you want to see some big moves in Government yields, look into Europe. Here is Italy just last week...

@FerroTV: The Italian 2-year has climbed 54bps in just 6 sessions. As we go from pricing in nothing from the ECB to something, worth noting that even one of the most hawkish members of the ECB (Knot) doesn't see a hike until Q4.

Government Yields

Time for the ECB to catch up to the Fed's hawkishness...

Tweet from @FerroTV

10-year Greek bonds are also sailing higher, which could be tricky for any owners of the paper...

@Schuldensuehner: OUCH! Greek bonds are bearing the brunt of #ECB's hawkish pivot. #Greece's 10y yields jump by 27bps to 2.55%, the highest level since Apr 2020.

Greece 10y yields

Even Japan is seeing 2-year yields that it hasn't visited in several years...

@RenMacLLC: After 2-yrs of being "overserved", US Tsy yields are breaking out, but equally important are JGBs at a 6yr high (below), with Gilts & Bunds close behind. US Real Yields now "only" -.50bps, but directionally impacting concept capital and the associated dreams.

Japan Government 10 Year

One positive to all the launching yields around the world is that investors can actually begin to earn a positive cash yield on their fixed income paper again...

@FerroTV: "The global stockpile of negative-yielding bonds has dropped to $4.9 trillion, the lowest in more than six years, after nearly $3 trillion was wiped out in just two days last week"

Negative yielding bonds

So, who benefits from rising interest rates? Financial stocks...

@sstrazza: $DB trading at its highest level in almost 4yrs

Deutsche Bank

And since the international markets are more overweight financials than the U.S., it only makes sense that foreign indexes are outperforming right now...

World Ex-US vs S&P 500

AllStarCharts


Worries are beginning in the high-yield markets as investors are leaving the ETFs...

The $7.4 billion US high-yield bond ETF, JNK, just reported its biggest weekly withdrawal since the height of the March 2020 pandemic-induced meltdown. (Jones Trading)

JNK US Equity

But in looking at the corporate spreads, I see less to worry about right now...

JPMorgan US HY STW

@swaptions


And the good news is that most corporate debt has been fixed and thus interest costs are less likely to follow interest rates higher...

“The financial crisis taught corporates and consumers about the risks of leverage .. Corporates locked in long-dated debt obligations at low fixed rates, with the mix of long-term fixed debt now 80% vs. 58% pre-GFC.” (Savita Subramanian/BofA)

80% of corporate debt is long-term fixed today

But we must unfortunately watch the money losing zombies...

Just too many firms out there that are not able to service their debt with yesterday's low rates. What will happen when they need to refinance? They will need to get their capital structures in place now.

US: Rising share of companies with debt servicing costs that are higher than profits

Deutsche Bank


But while interest rates have ripped higher, inflation expectations are beginning to stabilize. Could the market be happy that the Fed has its talons out?

@LizAnnSonders: U.S. breakeven #inflation rates have rolled over from peaks last year... 30y has moved down while 5y and 10y have stayed in ranges @FT @Bloomberg

Market measures of inflation expectations have fallen

TIPS investors also look like they are running for the door by liquidating their holdings...

largest outflow from TIPS

BofA


Interesting tight correlation between TIPS and QQQ...

Total Return

TheDailyShot


Likely that part of the small cap underperformance is tied to the number of unprofitable companies there while the tide is going out...

Roughly a third of Russell 2000 stocks expected to be unprofitable

The virus looks to be in a full retreat...

US Daily Cases

@fs_insight


As Barron’s wrote this weekend, Americans are ready to live with the remnants of Covid and move forward...

Seven in 10 Americans agree with the sentiment that “it’s time we accept that Covid is here to stay and we just need to get on with our lives,” according to a Monmouth University poll released this week.

A transition to a new pandemic normal holds major implications for the U.S. economy, and particularly for the hard-hit services sector, where recovery so far has been stunted even as spending elsewhere has soared. It’s likely to be reminiscent of the country’s first two reopenings—in summer 2020, after the initial series of lockdowns lifted, and spring 2021, after widespread vaccinations and another round of stimulus checks fueled fresh confidence among Americans. Consumer spending on services jumped 9.1% from the second to the third quarters of 2020, and 4% from the first to the second quarters of 2021.

Even the perception of a pandemic lull this time around could have a significant effect. “People are going to, I think, have an even more euphoric attitude toward this if we do feel like this is really the actual end of the pandemic,” says Jefferies economist Tom Simons. “That will feel like a boom.”...

The country’s services sector stands to benefit the most. For nearly two years now, demand has been red hot for goods, as consumers who couldn’t or wouldn’t get out shifted their spending toward everything from personal electronics to household appliances and home decor. But any steps back toward some semblance of normal life could also mean a potentially dramatic swing back to normal levels of spending, economists say.

While goods spending is 20% above its pre-Covid baseline, services spending remains 5% below that level, according to Tom Porcelli, chief U.S. economist at RBC Capital Markets. “That’s a staggering dispersion for a services-dominated economy,” Porcelli says.

The transition will be fueled further by the excess cash consumers have saved up. The personal savings rate has slowed back to its prepandemic normal, but middle-income consumers—those in the second, third, and fourth quintiles—are still sitting on roughly $1 trillion more in liquid assets than they were before the pandemic, by Porcelli’s estimate. That’s money waiting to be spent on things like restaurant dinners and plane tickets, as cooped-up and cash-rich consumers feel safe enough to start venturing out again.

Barrons

Barron's cover story

Bleisure = More trips, more travel, more working in remote locations and a smaller home base?

The ability to work from home is profoundly, and permanently, changing the way we travel. More lenient office policies mean many workers can travel anytime, even during busy workweeks, as long as they can hit deadlines from far afield. That, in turn, has made it easier for people to travel more frequently and for longer amounts of time, sometimes unlocking farther-flung destinations. The mixing of work and play, which some industry insiders (annoyingly) refer to as “bleisure” (business + leisure) travel, has greatly helped airlines make up for lost traffic.

“The ‘great untethering’ isn’t a trend, it’s permanent,” says Chris Lehane, global head of policy and communications for Airbnb Inc. “It’s a durable and enduring pattern that would have ultimately happened as society moved forward, even without the pandemic.”

“When you think about the technologies that have transformed travel, what we’re doing now, communicating and working on Zoom, is maybe even bigger than the advent of steam trains or commercial flight,” Lehane continues. “The entire construct of travel is in the midst of a change right now.”

That’s why companies as wide-ranging as Airbnb, Deloitte, and travel trade publication Skift have called the continuation of remote work the greatest change maker in travel for 2022.

Bloomberg


Who is ready for fully-staffed airlines and on-time travel?

@RenMacLLC: Is air travel about to get a little more enjoyable, fewer staffing induced delays and flight cancellations? Perhaps. Airlines are beefing up their workforces. Air transportation payrolls have recovered sharply, now up 2% relative to the same month two years ago.

All Employees: Air Transportation

Car sales are back!

@calculatedrisk: January Vehicles Sales increased to 15.04 million SAAR. Looks like the supply disruption is easing for new vehicles. This was well above consensus forecasts.

U.S. Light Vehicle Sales

And finally, auto dealership inventories are building...

Last week, both General Motors (+25-30%) and Ford (+10-15%) guided deliveries higher for 2022. Fire up those auto factories.

Domestic Auto Inventories

@IvanTheK


Used car prices are next to fall...

After surging through the pandemic by as much as 50%, prices in the used-car market showed some easing in the last three weeks of January, according to car-shopping app CoPilot, which tracks daily prices at dealerships across the country.

“For just about every age bracket and segment, prices reached all-time highs in late 2021, and have started to level off or soften over the past month — a potential signaling of relief on the horizon for consumers in the car-buying market,” said Pat Ryan, founder and CEO of CoPilot.

For cars that are 1 to 3 years old — a category that has driven much of the price jump — the average cost is $41,121, down 2.1% from about $42,000 in early January, according to CoPilot. The price of 2019 models have slid by 2.5%, while 2020 vehicles are down 4.4%.

At the same time, dealer inventories have risen 15% for 2019 cars and 22% for 2020 models, CoPilot said.

CNBC


A great stat from BofA on this quarter’s CAPEX spending. Also, great news for the economy...

@MikeZaccardi: 191 S&P 500 companies have reported capex so far, and we have seen a big jump in capex. Reported capex is tracking +18% YoY and +19% vs. 4Q19

Capex jumps both on a YoY and 2-yr basis

It sure didn't seem like a less volatile earnings season...

@bespokeinvest: Seems like it's the opposite because of some big moves from high-profile names, but stocks have actually been less volatile on their earnings reaction days this season versus the average over the last ten years.

Stocks' Average Absolute 1-Day % Chg on Earnings Days

Okay, lots of earnings bullets here...

Estee Lauder Companies Inc (EL): …channel trends are encouraging for the long term, even if tempered in this moment by Omicron.

ManpowerGroup Inc (MAN): …our ManpowerGroup Employment Outlook Survey, which showed that across 40 countries and 40,000 employers, hiring outlooks were strong. For the first time since the pandemic began, all countries reported positive hiring outlooks.

@TriInvRsrch

"Since mid-December, we experienced an increase in the number of people testing positive for COVID onboard our ships. The good news is that in the last several weeks, cases on board our ships have been declining rapidly, and we now have returned to exceptionally low pre-Omicron levels. In fact, over the last 7 days, we have averaged only a handful of positive guest cases per cruise -- With the declining cases, operational challenges are also abating, so while the variant is not done, it appears that the worst is behind us."

"With the peak in Omicron now seemingly behind us, we have seen a meaningful and sequential improvement in the booking activity week-over-week since the beginning of the year. In fact, in the last week of January, bookings returned to pre-Omicron levels, and we expect demand recovery to accelerate as the variant subsides"
- Royal Caribbean Cruise (RCL) CEO Jason Liberty

"We saw improved semiconductor availability in the fourth quarter compared to the third quarter, which enabled us to increase our wholesale sequentially while substantially reducing our inventory of vehicles built without certain components, and we expect ongoing semiconductor availability improvements throughout 2022."
- General Motors (GM) CFO Paul Jacobson

"The world is facing a tightening supply and demand gap for energy after years of underinvestment and current global activity levels are insufficient to bridge that gap. Commodity markets are waking up to the fact that the world consumed a 1 billion-barrel inventory overhang that we generated during the lockdown of 2020 in less than 15 months."
- National Oil Varco (NOV) Chairman of the Board Clay Williams

@TheTranscript_


Amazon reported earnings that saved the market last week...

Most importantly, there are no problems with their cloud biz (Amazon Web Services). Sales +40%, Income + 48%.

Segment Results - AWS

Amazon


In fact, the cloud did very well during the Q4...

Tweet from @jaminball

Google did very well outside of its cloud business, also led by an acceleration in Search...

@borrowed_ideas: For the first time in a quarter, revenue from YouTube ads exceeded $NFLX revenue. 15 years ago, GOOG bought YouTube for $1.65 Bn. The king of AVOD *grew* its topline by ~9 Bn in 2021.

Google revenue

More earnings comments...

United Parcel Service Inc. Chief Executive Carol Tomé
“In terms of current trends, the first week of January, I’m like, where are the customers? Everybody seemed to be at home because of Omicron, but the business has come back roaring. So we’re feeling really good about the guidance that we’ve just given.” (Feb. 1)

General Motors Co. Chief Executive Mary Barra
“What we’re sharing is what we see with the work that we’ve done with all of the semiconductor manufacturers and our plans for this year,” Ms. Barra said. We’re “definitely seeing improvement in first quarter over fourth quarter. We saw fourth quarter better than third quarter. And we really see, with the plans we have in place now, by the time we get to third and fourth quarter, we’re going to be really starting to see the semiconductor constraints diminish.” (Feb. 1)

Ralph Lauren Corp. Chief Operating Officer Jane Nielsen
“This holiday specifically, what drove our outsized performance was really our consumers, which shopped early and shopped at full price. So we got ahead of the curve on the holiday, and we maintained that momentum through the holiday without pulling significant promotional levers. We were much less promotional this year than we were last year.” (Feb. 3)

Capri Holdings Ltd. Chief Executive John Idol
“Our full-price selling is up dramatically…The health of the consumer entering our brand, both new and existing, is really quite strong.” (Feb. 2)

WSJ


Commodities remain a sore point for manufacturers, but an opportunity for investors...

Jeff Currie, the closely-followed head of commodities research at Goldman Sachs Group Inc., says he’s never seen commodity markets pricing in the shortages they are right now.

“I’ve been doing this 30 years and I’ve never seen markets like this,” Currie said in a Bloomberg TV interview. “This is a molecule crisis. We’re out of everything, I don’t care if it’s oil, gas, coal, copper, aluminum, you name it we’re out of it.”

Futures curves in several markets are trading in super-backwardation -- a structure that indicates traders are paying bumper premiums for immediate supply. The downward sloping shape in prices is generally taken to mean commodities are severely undersupplied.

On the charge

Bloomberg


Few better charts in the market right now than the energy stock indexes...

@hmeisler: XLE. The DSI for oil was 91 Friday.

Energy Select Sector Fund

Are energy stocks just getting warmed up?

@mark_ungewitter: $XLE / $SPY trend reversal

Energy Select Sector Fund/SPDR S&P 500 ETF

Fifty-month moving averages aren't my thing, but it might be the last line of defense for Facebook/Meta...

Meta Platforms

@HumbleStudent


Why did Facebook get kicked in the teeth last week?

Sure TikTok gets the blame, but Megan McArdle has a better explanation below. Apple just accelerated Meta's plans to get to the metaverse even faster now.

Meta, Facebook’s parent company, just had a truly horrific earnings call. The platform lost roughly half a million users in the fourth quarter of 2021, the first time its user base has declined in the company’s history. As in any business that’s dependent on network effects, there is a real risk that the shrinkage will accelerate, as each departing user makes the network less valuable to those who remain.

But Facebook’s problem on the revenue side is, if anything, bigger. Over the past decade, Facebook has had an enormous competitive advantage in the ad market, because of its huge reach — almost 2 billion users a day! — and its ability to precisely target advertising to those users. Alas, recent changes to Apple’s IOS have made it a lot more difficult for companies like Facebook to track the activities of their mobile users.

Facebook, and Facebook analysts, have known this was coming for a while. But on Wednesday, Facebook quantified the damage: an expected $10 billion in 2022.

That’s a lot of money, even for Facebook — 8.5 percent of its 2021 revenue and fully a quarter of last year’s profits. Unsurprisingly, Meta shares plunged on the news. The company’s stock has lost a quarter of its value since Wednesday...

In 2012, Mark Zuckerberg decided to take the company all in on a mobile-first strategy. This was disruptive, at first, but in time, he would be seen as a visionary prophet leading his company to the promised land.

The problem is, that land wasn’t owned by him. Zuckerberg had shifted his company away from the open platform of the browser and onto a closed system where Apple set the terms. For a long time, that was a very good deal for Facebook — but when Apple decided to alter the deal, Facebook didn’t really have much recourse.

Washington Post


With NVIDIA quickly closing in on the market cap of Meta Platforms, we should use the opportunity to evolve the FAANG moniker into BAATMAN...

The top seven market caps in the S&P 500 might soon be: Apple, Microsoft, Alphabet, Amazon, Tesla, Berkshire Hathaway and NVDIA.

FAANG & Fed's Excellent Adventure

BofA


The time is now for private market vehicles moving into retail…

One of the rationales behind the shift is to take advantage of the growth in private wealth. The mass affluent and high-net-worth investor market accounted for about $177 trillion in assets as of 2020, and is expected to grow to $222 trillion by 2025, according to a PricewaterhouseCoopers report. That compares to about $63 trillion in institutional assets under management as of 2020, which is expected to grow to about $78 trillion by 2025.

These managers see more room new ground to till on the retail side. Many institutions are fully allocated to alternatives, with an average 26% of their portfolios committed, according to a CoreData survey. Some endowments have allocations as high as 60%, according to UBS.

Meanwhile, retail allocations are in the single digits, but growing rapidly, says Matt Brown, CEO of CAIS, a platform for alternatives.

“That's all new money,” Brown says. “That market opportunity is not lost on asset managers, so what they're doing is they are beefing up their sales teams and innovating products, structures that allow their funds and strategies to be more easily delivered into the wealth management space.”

Institutional allocations may be large, but that's a risk; they can easily be taken away from the managers, Brown says. Wealth management allocations are diversified among different advisors and the underlying investors, and therefore much stickier…

“We looked at that market, and we faced the challenges of trying to solve for getting them exposure in a way that made sense,” says Stephen Brennan, head of private wealth solutions at Hamilton Lane. “So, what really has changed in the last number of years is creating some of these innovative structures that would allow investors to get fully invested at the time that they make their investments, as opposed to going through the capital call process of a traditional private equity fund, providing lower minimums that are certainly much lower than the $5 to $10 million minimums that you would have in a more institutional type product, things like simplified tax reporting.”

Wealth Management


'The Power Law' is a new book about venture capital and the early key Silicon Valley players...

While I haven't read it yet, Marc Rubenstein shares a few stories in his recent piece. I am anxious to read the book while also being envious of Sequoia Capital's track record.

The firm is notoriously private. It encourages its ‘scouts’ to sign NDAs and until recently it didn’t accept certain funds as LPs if they are subject to public disclosure requirements. Twenty years ago, the firm asked two of its investors – endowments for the University of California and University of Michigan – to leave its vintage 2000 Sequoia Capital X fund and sell their interests in older funds, after lawsuits prompted them to publish fund return information in response to open records requests. But ahead of raising $8 billion for its global growth fund in 2018, it allowed public funds back in. One of them was the Washington State Investment Board, and their disclosures provide some insight.

The Private Markets Committee of the Washington State Investment Board met to discuss an investment in Sequoia’s new fund on 5 April 2018. Minutes of the meeting record that Doug Leone and Chris Cooper of Sequoia were in attendance. Leone “reviewed Sequoia’s evolution, global footprint, and limited partners, stating that no one has ever lost money investing in Sequoia Capital.” No one has ever lost money – that’s quite a statement! It contrasts with hedge funds where subscriptions frequently come in after a bout of outperformance, losing those investors money (Paulson being a prime example of a fund where plenty of LPs who came in after 2009 lost money).

FAANG & Fed's Excellent Adventure

Net Interest


Such a great read on Paxlovid. How Pfizer made an effective anti-Covid pill...

"Chemists at Pfizer’s research facility in Connecticut dusted off some ideas the company had developed during the SARS outbreak in 2003. Even back then, an obvious line of attack had been to block a well-understood component of the virus life cycle involving a key protease, a protein that orchestrates how the virus copies itself. Find a chemical that is able to stick tightly enough to that protein, and it would stop the virus from replicating in the body, lessening the chances that a patient would become seriously ill.

Right away, researchers got a lucky break. When Pfizer checked, it found that none of the thousands of proteins in the human body shared the same bit of molecular structure they planned to interfere with in SARS-CoV-2. That meant they could hit the virus hard and not expect any major side effects. Nature had provided the scientists with a big bull’s-eye. “This is the most solid biological target I have ever worked on,” says Pfizer chemist Dafydd Owen."...

"By the fall of 2021, Pfizer was ready to declare success. A monitoring board decided to stop the human study because covid-19 patients on Paxlovid weren’t dying—but those given the dummy drug were. “It was an incredible moment,” says Charlotte Allerton, Pfizer’s head of medicine design. Even though it trailed the vaccine development by nearly a year, Allerton believes Paxlovid still set a record—the fastest any drug company has ever moved from a synthesizing a new chemical to proving that it safely treats a disease.

A test in unvaccinated volunteers done by Pfizer had shown that the new pill cut the chance of a serious case of covid by 89%....

"Crucially, the protease is, in the jargon of biologists, a “highly conserved” molecule. That means that even as the virus evolves, this part rarely changes. So while the coronavirus has been mutating quickly to evade vaccines, so far it looks as though Paxlovid will work just as well against any variant—whether it’s omicron or whatever comes next.

In fact, laboratory tests run by Pfizer suggest Paxlovid will work against all coronaviruses, maybe even one still lurking in a bat cave somewhere. If so, it means the company has hit on a potential defense against the next outbreak, too. “It has the potential to be a pan-coronavirus agent and stockpiled against future pandemics,” says Owen, the Pfizer chemist. “But it’s here for this pandemic, because we did it super fast.”...

"“I feel that Paxlovid is the big step we were working for this pandemic,” says Kris White, a researcher at the Icahn School of Medicine in New York, who was recruited by Pfizer to give the drugs to mice in 2020. “I believe it is going to be the treatment for covid.”

As he says, “You get a prescription, you go to the CVS, and that’s it.”

MIT Technology Review


Lots of beating on Facebook/Meta this week. So here is a positive story on the use of the social network...

Shannon St. Onge found herself in the thick of a blizzard on Monday evening, lost on a Saskatchewan road and peering out her rolled-down window for a glimpse of the road.

With a little luck — and the help of a stranger in Vancouver who saw a Facebook post — she and six others were saved by an 80-year-old retiree who walked through the whirling snow to help them....

She posted her location on the Pense community Facebook page. Community members started guessing at where she was located. One man — who happened to be originally from Pense, but now lives in Vancouver — figured out her location.

"He private messaged me and said, 'I know that family. Send me your phone number and I'll contact their son,'" St. Onge said.

Andre Bouvier Sr. was doing some genealogy research when he got the call about St. Onge's plea for help. He decided to help her out, despite his wife's concern for his well-being heading out in the storm.

The 80-year-old retiree tried to start his tractor, but it was dead.

He bundled up, grabbed an LED flashlight and walked about half a kilometre into the raging storm to search for St. Onge's car. He knew he could walk to where she was as long as he stayed on the road...

To Bouvier's surprise, he found two other vehicles with people who also needed help stranded alongside St. Onge.

He led the seven stranded people back to his home and welcomed them in for the evening.

Blizzard Stranded

CBC


And finally, thanks to Snippet Finance. We are honored to be in such great company...

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DISCLOSURES

The author has current equity ownership in: Alphabet Inc., Amazon.com Inc., Pfizer Inc., NVIDIA Corp., and Microsoft Corp.

The information presented here is for informational purposes only, and this document is not to be construed as an offer to sell, or the solicitation of an offer to buy, securities. Some investments are not suitable for all investors, and there can be no assurance that any investment strategy will be successful. The hyperlinks included in this message provide direct access to other Internet resources, including Web sites. While we believe this information to be from reliable sources, Hamilton Lane is not responsible for the accuracy or content of information contained in these sites. Although we make every effort to ensure these links are accurate, up to date and relevant, we cannot take responsibility for pages maintained by external providers. The views expressed by these external providers on their own Web pages or on external sites they link to are not necessarily those of Hamilton Lane.

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