Week InReview
Friday | May 21, 2021
WFH bent us out of shape.
Illustration: Rosie McGuiness/WSJ
Over the past year, the cumulative effect of work-from-home scenarios – makeshift workstations at kitchen tables, on couches or beds, without proper chairs or desks; bare or slipper-shod feet, without the support of shoes – has been noticeably detrimental. Prolonged sitting is the main cause of this misalignment.

— The Wall Street Journal
let's recap...
Photo: Financial Times
Earnings season in the U.S. is coming to a close, and while it is still in full swing across the Atlantic, one thing is clear: analysts far underestimated how much of a bonanza the global economic recovery delivered in the first quarter of 2021. So why have equity markets shrugged? (Financial Times | May 19)

The surge in commodities prices is failing to trigger some of the traditional responses in bonds and currencies. Unlike recent commodities rallies in 2008 and 2011, yields on Treasuries and currencies of major exporters like Australia have barely budged. Likewise, the Federal Reserve’s favored measure of inflation expectations has disconnected from moves in raw materials. The biggest buffer: central bank credibility. Led by the Federal Reserve, policy makers have consistently doubled down on lower-for-longer rates and projections for “transitory” inflation. That’s left investors wary to bet against commitments to keep policy loose for the foreseeable future. (Bloomberg Economics | May 18)

U.S. Treasury Secretary Janet Yellen is planning to travel to London for a June 4-5 meeting with her Group of Seven counterparts. The U.K., this year’s rotating G7 host, earlier this month announced that it would hold the meeting in person as the spread of Covid-19 begins to subside. Chancellor Rishi Sunak will lead the gathering, which will include central bankers from Italy, Canada, France, Germany and Japan, as well as leaders from the International Monetary Fund, World Bank and other multilateral institutions. (Bloomberg Politics | May 18)

Eleven progressive policy groups are calling on the Securities and Exchange Commission to replace the leaders of the U.S. audit watchdog, saying the regulator has failed to protect the interests of investors under the oversight of Trump-era appointees. In a letter Friday to SEC Chair Gary Gensler, the groups said the Public Company Accounting Oversight Board has atrophied under the leadership of Chair Bill Duhnke and pointed to internal complaints from staff, past senior staff vacancies, and a “pattern of non-enforcement.” (Bloomberg Law | May 18)

Gross market values of over-the-counter derivatives soared by more than a third in 2020 to their highest level since 2016. Data from the Bank for International Settlements shows the fair values of outstanding contracts hit $15.8 trillion at the end of last year, up $4.2 trillion (36%) over the past 12 months. Notional amounts rose 4% to $582 trillion over the same period. (Risk | May 17)
Five takeaways from Fed April meeting minutes
(May 19) — Here are the key takeaways from the Federal Open Market Committee’s April 27-28 policy meeting minutes released Wednesday.
  • There was less unanimity about the timeline for considering a tapering in asset purchases. “A number” of meeting participants suggested “it might be appropriate at some point in upcoming meetings to begin discussing a plan” for taperinga shift from March, when there was no such suggestion.
  • Federal Reserve officials had a discussion about financial stability in the wake of the run-up in asset prices and the Archegos affair. “A couple of participants remarked that, should investor risk appetite fall, an associated drop in asset prices coupled with high business and financial leverage could have adverse implications for the real economy.”
  • The discussion around the outlook for growth and inflation evolved from March, with participants assessing that “risks to the outlook were no longer as elevated as in previous months.” And “some participants mentioned upside risks around the inflation outlook that could arise if temporary factors influencing inflation turned out to be more persistent than expected.” There was a discussion about signs of a shortage of labor, which were later confirmed by the April jobs report. “Some participants noted that the step-up in demand for labor had started to put some upward pressure on wages."
  • The minutes also showed participants discussing the merits of standing repo facilities for both domestic and foreign institutions, noting that the benefits outweighed the costs.
  • Treasury yields climbed on the signs that it’s not just Dallas Fed President Robert Kaplan who thinks that "the discussion of tapering asset purchases ought to happen sooner rather than later.” Ten-year yields were up 5 basis points, at 1.69%, as of 2:52 p.m. Stocks fluctuated, adding to the session’s losses, then recouping some of that drop before a renewed slide.

Source: Bloomberg Government
the cyber cafe
Photo: The Economist
From black hats to zoombombing: your guide to cybercrime and hacking slang
The malevolence of cybercrime often seems all the worse for the impenetrable jargon used to describe attacks. Confusing you is exactly what these cyber-attackers want. To outsmart online scammers you need to speak their language

Quicker on the draw
Hackers move to exploit vulnerabilities within minutes of when they are disclosed. Companies take about 12 hours, on average, to find and fix the same vulnerabilities, according to researchers at cybersecurity firm Palo Alto Networks Inc. 

Gathering momentum and money
The White House on Tuesday outlined plans to allocate federal funds to improve cybersecurity in critical infrastructure while lawmakers in the House put forth several bills on cybersecurity related to pipelines, state and local government and supply chains, among other security topics. An executive order signed on Wednesday will force many companies selling software to the government to report attacks on their systems,
— Tech Radar
binge reading disorder
Illustration: Federico Babina/Harvard Business Review
That new hybrid office may not be as flexible as you hoped for
Driven in some places by Covid concerns and in others by a desire to embrace workplace change, hybrid work is the new center ground — at least in the short term. But with work-from-home mandates easing soon in many places, experts are concerned the future mix of home and office work will be complicated to manage and won’t provide the flexibility employees have become accustomed to during the pandemic.
— Bloomberg Wealth (Work)

How to prepare pets for your return to the office
For thousands of pets adopted during the pandemic, this will be the first time they’ll regularly be left in their new home alone for extended periods. And even for those whose owners worked outside the home before the pandemic, this will be another major disruption. So, what's a pet owner to do?

How being more productive starts with doing nothing
In our efforts to squeeze every second from the day, it seems counterintuitive to watch a pot of coffee boil or gaze out the window. But your brain uses those free periods for important cleanup work, neuroscience research indicates. And during the pandemic, as the boundaries between work and home have blurred, it has become harder to create mental breaks.
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