An electric future
By Justin Pyvis – Delivered on 10 Nov 2021

Good morning! Queensland's roadmap out of the pandemic was modified yesterday with the much-hated indoor facemask requirement to be dumped "when 80% of eligible Queenslanders have received at least one dose of a COVID-19 vaccine", which it should hit any day now (currently 78.3% aged 12+, 79.8% aged 16+).

In addition, on 17 December when the 80% double-dose target is expected to be reached the fully vaccinated will be "rewarded" with access to venues such as aged care, hospitals, hotels, pubs, cafes, restaurants, concerts, theatres, stadiums, festivals, galleries, libraries... basically anything indoors or where there is likely to be a large gathering of people. The unvaccinated will be locked out from all of the above entirely, with the rules to be "reviewed" when the state reaches 90% fully vaxxed.

Elsewhere, the ACT government confirmed that it would bring forward a relaxation of restrictions by two weeks due to the territory's Australia-leading vaccination rate. That means as at 11.59pm on Thursday gathering limits will be scrapped, density limits will be relaxed to allow one person every 2sqm in most indoor environments and facemasks will only be required in high-risk settings.

Finally, a few thousand Kiwis took to the streets to protest the government's vaccine mandate yesterday. New Zealand recently passed Australia's rate of vaccination, with 89.0% of those aged 12+ having received at least a first dose versus 88.3% in Australia.

Fully vaccinated population (aged 12+)


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Note: Brent oil, gold bullion and iron ore prices are the second futures contract. Bond yields are 10-year Treasuries. The S&P500 is a snapshot 30 minutes before close.

At the time of writing the US S&P500 (-0.49%) looked set to end its run of eight consecutive sessions of record high closes, with an indicator of inflation coming in hot (producer prices, see Economy below) and Tesla (-12.2%) smashed as Elon Musk gears up to sell 10% of his holdings to pay a hefty tax bill.

Locally, the ASX200 fell 0.24% with gains in tech (+1.1%) and materials (+1.0%) not enough to offset declines in energy (-1.0%) and financials (-1.0%), after NAB (-0.76%) reported solid full-year profit but paid a lower dividend than pre-pandemic and warned that "uncertainties exist in the outlook including the impact of tapering support".


Growing confident: According to NAB, business conditions and confidence rose back above the long-run average in October after lockdowns were removed in NSW and VIC. However, there was also an ominous "build-up in price pressures in the economy with the impact of elevated goods demand alongside supply chain disruptions and border restrictions pushing input cost inflation to the highest level in a decade".

Building boom: According to the Housing Industry Association, new home sales in Australia were still at their highest level since 2017 in October "despite the end of the federal governments HomeBuilder grants program in March".

A mixed recovery: Economic sentiment picked up in Germany for the first time since May, according to the November ZEW survey of financial market exports. However, there was a "renewed decline in the assessment of the economic situation... [as] the supply bottlenecks for raw materials and intermediate products as well as the high inflation rate will have a negative impact on the economic development in the current quarter".

Crypto craze: Crypto's latest rally reached a new milestone, passing a market capitalisation of $US3 trillion for the first time ever as both Bitcoin and Ethereum recorded fresh all-time highs.

Son's best bet: Well-known Japanese tech punter and founder of SoftBank, Masayoshi Son, promised a ¥1 trillion (~$A11.1 billion) share buyback programme over the next 12 months. The move came after his pet division, the so-called Vision Fund, reported a loss of ¥825.1 billion last quarter. Buybacks are unexciting but in this case it's probably less risky than what Son would have done with the cash.

Inflation brewing: The US producer price index (the prices that factories charge wholesalers) rose 0.6% in October from the prior month, or 8.6% from a year ago, the equal highest ever. Even removing so-called 'volatile' items such as food and energy, prices increased 0.4% from the prior month or 6.2% on the year.

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An electric future

ScoMo unveiled his government's "Future Fuels and Vehicles Strategy" yesterday, another big spending initiative that aims to cut emissions (8Mt CO₂-e by 2035), build electric vehicle (EV) charging infrastructure ("over 1,000 new public access fast charging stations") accessible to 84% of the population, all to "create the environment for there to be 1.7 million electric vehicles on the road by 2030".

Someone must have whispered in ScoMo's ear during the COP26 (or maybe he got some updated polling?) because in the span of just two years, ScoMo has gone from claiming that EV would "end the weekend" to committing "more than $A500 million... to ensure the electricity grid is ready for an increase in electric vehicles".

Why this matters: For the average household, there's no doubt that EVs will one day take over from those powered by internal combustion engines. The trend was already there before the pandemic struck and just about every government used the crisis as an opportunity to speed it up further.

However, Australian governments have been relatively quiet on the issue and some, such as in Victoria, went in completely the opposite direction by passing a per-kilometre tax on electric vehicles.

Breaking it down: According to the International Energy Agency, the main barrier to EV adoption is the lack of charging infrastructure (67%), which was the main focus of ScoMo's announcement. Vehicle manufacturers from Hyundai to Ford have recently commented that a lack of policy and infrastructure in Australia has prevented them from expanding the EV line-ups in the country, so this will likely encourage them to broaden their Australian offerings.

Looking forward: While the "Future Fuels and Vehicles Strategy" should accelerate the uptake of EVs in Australia, it may not do much for the environment – Australia generates most of the electricity that will power said vehicles by burning coal (54%) and gas (~20%). A lot was made of hydrogen's role in powering "refuelling infrastructure" in the Strategy, but it's an unproven technology that could still be many, many years away from reaching commercial viability, if ever.

The Wrap Up
    👩‍⚕️Doctors and nurses in Greece are being bribed by anti-vaxxers to inject them with water. Turns out many were pocketing the cash and administering a COVID-19 vaccine anyway.
    🐱‍💻Retail share trading app Robinhood said it accidentally "exposed information on millions of customers", after a hacker gained access after posing as a customer support employee by phone.
    🐥Sesame Street's Big Bird took to Twitter to announce they had received a COVID-19 vaccination and was promptly attacked by the likes of Texas Senator Ted Cruz and Arizona Senator Wendy Rogers, who accused Big Bird of being "a communist".
    🏉Unvaccinated NRL players will be banned from playing or training in Victoria or Queensland, in-line with their respective state public health orders.
    🏥Singapore's government will no longer cover the medical costs of people "unvaccinated by choice" if they require treatment for COVID-19, as they "disproportionately contribute to the strain on our health care resources".
    ⛈️Yesterday Perth recorded double (over 40mm) the amount of rain it normally gets in all of November, the most in a single November day since records began in 1880.
    ⛰️Centibillionaire (yeah that's a thing now) Jeff Bezos 'jokingly' threatened Leonardo DiCaprio with a picture of a steep cliff, after the actor was filmed flirting with his girlfriend at the Art Gala in LA.
    🤮A Kiwi who intentionally infected himself with COVID-19 "because he didn't think it was serious" ended up in hospital, passed it on to his son and said "I do not recommend this lil experiment to anyone".
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