MoneyWeek 1083/1084

“Prediction is pointless. So we have – of course – had a go at it for 2022” At the start of 2021 we had some clear ideas on what we expected from the economy and markets. With pent-up demand real –consumers had pockets jammed with newly minted cash and a near-desperate urge to get out and spend – GDP would recover fast. We expected that, alongside staff shortages, to be one driver of non-transient inflation. We thought we might start to see the fruits of the hard labour many companies put in during the pandemic (to cut costs, digitalise, and strengthen supply chains) in the productivity numbers. Finally, we expected interest rates to rise a little (not as much as inflation, but a little); bond prices to fall (as rates rose);…

The death of Zappos founder Tony Hsieh (pictured) without a will has led to a fierce battle between friends and family over his estate, which is thought to be worth at least $500m, reports The Wall Street Journal. Lawyers trying to resolve the claims are now perusing an eccentric collection of sticky notes that Hsieh used to cover the walls of his Utah mansion, which detail everything from his spiritual “life mantras” to specifics of financial deals. Hsieh died in November last year aged just 46, following injuries sustained in a fire. His longtime friend Mimi Pham is seeking $90m, while his financial advisor Tony Lee is pursuing $7.5m. The latter accuses Hsieh’s brother Andy of enabling the drug and alcohol problems that dogged Hsieh in his last year of…

Superhero film Spider-Man: No Way Home, starring Tom Holland and Zendaya (pictured), had already sold $587.2m of tickets globally as of last weekend, says the Financial Times – the third-best opening weekend of all time. Sony Pictures’ new film also set a pandemic-era record, outstripping other big releases including recent James Bond flick No Time to Die. Apple employees are being gifted $1,000 by the company to kit out their home offices after it announced they can all work from home indefinitely as coronavirus cases linked to the Omicron variant surge, says The New York Times. The company has temporarily closed three of its shops in Miami, Ottawa and Annapolis after a spike in the number of positive tests among staff in the branches.…

Musician Eric Clapton successfully sued a German woman known as Gabriele P for trying to sell abootleg recording of one of his 1987 concerts online, landing her with both party’s legal fees of €3,400, says DW News. The woman – who had tried to sell the CD on eBay for €9.95 – said that her husband had bought it from a department store, but the judge ruled that it didn’t matter that she didn’t know the recording was made illegally. Sheikh Mohammed Bin Rashid Al-Maktoum, 72, Dubai’s billionaire ruler, is to pay around £554m in child maintenance and security costs to his “estranged” wife Princess Haya Bint Al-Hussain, 47, reports the BBC. Princess Haya, youngest of the sheikh’s six wives, fled Dubai for Britain with her two children in 2019 “in fear…

“Surprise, surprise!”, says Ipek Ozkardeskaya of Swissquote. Last month the Bank of England failed to raise interest rates despite market bets that it would. This month it has pulled the reverse trick, becoming the first big central bank to raise the cost of borrowing. The 0.15 percentage point rise to 0.25% came despite market bets that Omicron-related uncertainty would cause the Bank to keep policy steady. With inflation at an annual rate of 5.1% and predicted to hit 6% next April, the Bank decided it didn’t have the luxury of waiting for more clarity about Omicron. Fighting for credibility The interest rate hike is so “marginal” that it is “frankly… unlikely to make much of a difference”, says Jeremy Warner in The Daily Telegraph. All the same, it is an important signal…

Global stockmarkets fell at the start of this week as investors grew increasingly fearful about the impact of the Omicron variant. Stocks had sold off at the end of November after news of the new variant broke, but then recovered this month on hopes that it would prove milder than previous strains. Yet with UK infections hitting new records, borders closing and the Netherlands re-entering lockdown, traders dusted off the pandemic playbook, selling airlines and leisure stocks. The FTSE 100 tumbled by 2.1% in early morning trading on Monday, before paring losses to close down 1%. Germany’s Dax plunged almost 3% before ending the day down 1.9%. Japan’s Topix closed more than 2% down. In America, traders are also digesting political news that could spell the end of Joe Biden’s spending plans…