Above the Fold

Europe Turns Decidedly Hawkish

Up until recently, the ECB (European Central Bank), which is essentially the Federal Reserve of the eurozone (the group of countries that have adopted the euro currency), had been taking a more accommodative monetary stance. Up until about a week ago, it seemed that the ECB was to stay on a more stimulative path when it came to policy. But after a flash estimate for January inflation registered a whopping 5.1% annualized rate, the ECB, headed by Christine Lagarde, quickly shifted its trajectory. 

Last Thursday, Lagarde acknowledged that eurozone inflation was running higher than expected, and hinted at the risks of further price escalations. Her tone was markedly more hawkish than in previous statements, and she noted that future rate hikes would be “data-dependent,” stripping the terms “unlikely” and/or “very-unlikely” when it came to a rate hike in 2022. We believe that this tone will probably strengthen in coming meetings, and an increase in rates is likely to begin in mid-2022. European money markets are currently pricing in an 80% chance of a 10 bps (basis point) hike in June and a nearly 100% chance of 40 bps by the end of the year. The news also sent the euro soaring, clocking the largest daily move in over a year. The ECB actually controls three sets of rates: the benchmark refinancing rate, the rate on its marginal lending facility and the rate on its deposit facility; those rates are currently 0%, 0.25% and -0.5%, respectively. 

Three Things 

1. Lyft Gets a Lift From Price Hikes – Compared to 2020, rideshare company Lyft saw fourth-quarter revenues jump 70% in 2021. The San Francisco-based company reported nearly $970 million in the quarter, fueled by record-high ride prices. The price increases were due both to driver shortages and internal adjustments. Lyft also reported 18.7 million active riders in Q4, compared with 12.6 million during the same period a year prior. Despite the increases, the company still reported a $1.01 billion loss. 
2. Flipping Gig Work on TikTok – Users of the China-based social platform have already found a myriad of ways to generate income. The latest scheme involves something called “drop servicing,” which is a sort of arbitrage where an influencer promotes and sells a service at a premium price, then subcontracts that service out to users on other platforms (like Fiverr), paying them a fraction of the income they collected … pocketing the spread. 
3. Amazon Care Expands Nationwide – Amazon’s virtual health care program for employees and other companies that use its benefits is now available across the country. The company will also launch in-person care services (which include in-home visits) to an additional 20 cities in 2022, with future expansion into every state already mapped out. Amazon operates its own pharmacy and purchased pharma-delivery company PillPack in 2018. It’s likely that the Amazon Care program could become a lower-cost option for employers across the country. 

Did You Know? 

Some Fun Facts About the Super Bowl

Admission to the first Super Bowl, between the Kansas City Chiefs and Green Bay Packers, cost as little as $6. Ticket prices for the last five Super Bowls have averaged more than $5,000. The most-watched Super Bowl was the 2015 matchup between the Seattle Seahawks and the New England Patriots, clocking nearly 114.5 million viewers. The Super Bowl is the second-largest eating event for Americans, second only to Thanksgiving. What’s even more amazing is that 12 NFL teams have never won a Super Bowl (Cincinnati is one of them) and four have never even made an appearance.