What You Need to Know
- The vaccination rate will weigh on the economy if it doesn't rise by early next year, he says.
- Ritholtz says he questions the broader judgement of financial professionals who choose not to get shots.
- On inflation, he says he's not too worried as growth slows and supply-chain bottlenecks ease.
The biggest risk to the U.S. stock market today, says Barry Ritholtz, co-founder, chairman and chief investment officer of Ritholtz Wealth Management, is not the Federal Reserve nor inflation. It’s the “one-third of Americans” who refuse to get vaccinated.
“We should be fully open with an 80%-plus vaccination rate to achieve full herd immunity and no worrying about another shutdown or people freaking out and staying home because they don’t want to get sick,” Ritholtz told ThinkAdvisor. “That is the single biggest risk facing the economy and the market.”
According to the Centers for Disease Control and Prevention, as of Aug. 12, 59.2% of Americans have received one dose of the vaccine and 50.4% have been fully vaccinated. Among those 12 or older — younger children are not yet eligible to receive a vaccine — 69.2% have received at least one dose, and 59% are fully vaccinated.
If the U.S. doesn’t boost its COVID-19 vaccination rate by early next year, it will be struggling with “a persistent drag on the economy,” and stuck in a “netherworld” between lockdowns and a full reopening, says Ritholtz. “It will be a weak reopening of the economy.”
“Corporate America has a leadership role to play here … to avoid seeing the economy slip back into another pandemic lockdown recession,” says Ritholtz. “It is in the self-interest of every company to require vaccines to come into the office — employees, suppliers, customers and guests…. If the governors are too cowardly to act, then corporate America should show them what leadership is.”
Some firms in the financial services industry are doing just that. According to Bloomberg, Morgan Stanley and Citigroup will be requiring staff to provide proof of vaccination; JPMorgan won’t allow unvaccinated employees to attend events with 25 or more people and they must be tested twice a week; Bank of America is initially allowing back in the office only employees who have said they’ve been vaccinated; and BofA and Wells Fargo are requiring all employees in the office to wear masks.
“I don’t think those choosing to not get vaccinated have a very bright career path,” says Ritholtz.