There is a joke circulating at the minute "I can't go to see my granny in her house but I can take her to a nightclub...". This is seen as yet more evidence of the insanity of government rules. How many times have you heard people say they can't keep up with the changes or that they make no sense? There are endless complaints as restrictions people don't like are set beside supposed loopholes as evidence of government overreach or bungling incompetence.
This is driving me nuts. The government is very clear in what it is doing and it doesn't need a genius to spot it. Leave aside all arguments about what they should have done the first time or how bad CV19 really is or how our testing is so poor - they actually don't matter. They believe that there is another wave of coronavirus crashing into the UK - they had hoped to avoid it or at least it wouldn't be so bad or magic fairies would make it go away or something but this cunning plan has failed. They want to protect jobs and tax revenues if at all possible.
So Step 1 is to restrict all social interactions that might affect the R rate but aren't taxable (the cup of weak tea you get in your grannies generates almost nothing while the three Jagerbombs she downs in the nightclub are valuable in economic terms). Step 2 is project fear (look at news feeds on BBC for evidence, look at presentation yesterday by Patrick Vallance and Chris Whitty, listen to prime ministers address tonight) because many people are paying little attention to Step 1. Step 3 is continual tightening of restrictions up to and including a second lockdown in order to get the virus under some sort of control. There is a clear hierarchy here: keep schools open at all costs, keep as much of business running as you can, keep tightening restrictions on the parts of the economy like travel and leisure to get some sort of control of R rate. If that fails, then we lockdown initially for two weeks but really who knows?
And this is where it gets interesting as an investor - what should we do next? What is your coronavirus playbook? Well, I can only tell you what I'm doing and ask for feedback - all appreciated. I learnt a…
