JUST PLAIN TALK: Vaccine refusal biggest threat to economy
All humans have confirmation bias; it's part of the evolutionary process. Three hundred generations ago, the red berries we found last week tasted good and didn't make us sick so let's eat these now. Today though, social media echo chambers amplify data and can throw you off base. So push back against confirmation bias but don't ignore data supporting your argument.
With Pfizer's full FDA approval, more employers are making vaccines mandatory. Some are passing increased COVID-related expenses to non-vaccinated workers. Some unions even push back against mandates. It's a strange hill to make your last stand on, but here we are. When our children were young, I didn't give measles or whooping cough a second thought, but not with the grandchildren. So we got DPT boosters to keep babies safe.
The economy is doing surprisingly well — a recent update from the Bureau of Economic Analysis shows 6 percent annualized growth. While some worry about the Federal Reserve changing monetary policy or inflation, Barry Ritholtz, chief investment officer of Ritholtz Wealth Management, argues vaccine refusal is "the single biggest risk facing the economy and the market."
A few people have health conditions that preclude vaccinations. More, though, have jobs that make vaccinations tricky to workaround. For example, Brian Kemp, Georgia's governor, made the Friday before Labor Day a state holiday to allow workers additional time to schedule an appointment. I understand how social media can amplify any message, particularly emotionally charged ones like vaccines. But the data is clear. Vaccines are safe, much safer than driving on U.S. Highway 98. Of course, everything has risks; the key is balancing risk with reward. Contracting COVID-19, unvaccinated, dwarfs potential adverse vaccine side effects.
On the good news front, vaccination rates have spiked up. But, sadly, so have COVID hospitalizations. Eighty percent plus vaccination rates would give the United States full herd immunity. Without more robust protection, Ritholtz worries we will be stuck in a "netherworld" between lockdowns and full reopening, weakening the economy.
Ritholtz argues American companies have a leadership role to play. "It's in the self-interest of every company to require vaccines" for employees, suppliers, customers, and guests. For example, Morgan Stanley, Bank of America, and Citigroup plan to require vaccinations for all staff, with opt-outs allowed individually. Delta, the airline not the bad guy, pointed out each COVID-related hospital stay costs the company $50,000.
Financial planning requires analyzing risk versus potential rewards. Evidence-based data matters; you have to view the world rationally. There will always be ambiguity, and you have to weigh the pros and cons. No one knows how long they will live or what future returns will be. Plus, inflation and tax rates could be significantly higher. Closer to home, risk and reward are why people live near the coast in Florida. A significant storm makes landfall in Grayton, and sooner or later one will, things change dramatically.
The best retirement planning move you can make is to get vaccinated.
You can't always get what you want, but Buz Livingston, CFP, can help you figure out what you need. For specific advice, visit livingstonfinancial.net or drop by 2050 West County Highway 30A, M1 Suite 230.