Melbourne continues to suffer. At least we know the economy will be fine.
Look, I’ll be honest. When Sydney’s outbreak launched, there was the tiniest bit of schadenfreude.
Melbourne had been doing it tough and there was Sydney, just cruising along with no cases and all that sunshine.
And so when the Sydney outbreak happened, and I’m not proud to admit it, but it did make me feel like we weren’t so alone over here in Melbourne.
Misery loves company.
But wouldn’t you know it, and maybe it’s karmic justice, but right now, Sydney seems to be winding down out of it’s outbreak, while things are only picking up in Melbourne.
On Sunday, NSW has recorded only 319 locally acquired cases and 10 deaths, numbers that are well down on recent highs.
Victoria on the other hand posted a whopping 1838 locally acquired COVID cases and seven deaths over the past 24 hours:
And those numbers are going from bad to worse.
And when you lay the Sydney outbreak with the recent Melbourne outbreak side by side, you can see that the Victorian outbreak is set to leave the NSW outbreak for dead.
There is no justice in this miserable world.
At least we’ve just decided to bit the bullet and face whatever Covid is going to give us. It was a nice dream that we could eliminate it, but it’s clear it was only ever a dream now.
And so I’m sending prayers for the people on the medical frontlines, and hoping that reopening doesn’t stretch the hospital system too much.
But while the health outcomes remain to be seen, I’m pretty confident the economy will be fine, no matter what happens.
And that’s because there’s still a lot of government support flowing into the system.
Deloitte has crunched the numbers, and the numbers look good.
While the mishmash of state/federal supports is certainly less encompassing than earlier JobKeeper supports, there are still a lot of dollars attached to them. And that sets the scene for a promising recovery as restrictions ease.
Last year, restrictions on movement and a collapse in confidence saw households rein in discretionary purchases. Added to that, generous government supports such as JobKeeper and the doubling of JobSeeker saw the incomes of some families rise. Combined, these factors lifted the household saving rate to a record high of 22% in June 2020.
Savings are again surging in this current lockdown… Government supports are also up. The COVID Disaster Payment has already injected $9.1b into the economy, and new state payments have also added at least $12b.
… Just as they did through 2020, we can expect households to draw down some of these excess savings when cafés, bars, clubs and restaurants throw open their doors in the very near future.
Yup. It’s one of the odd things to come out of Covid – a massive boost in household savings.
When we reopen fully, that should come bouncing back quickly.
That will eat up some of the savings.
But after that?
There’s a lot of money in the system.
And a lot of money to be made if you can stay ahead of it.