Marketfield’s Shaoul Says Economy Weathers Delta If Schools Open

The U.S. economy will shrug off a surge in Covid-19 cases from the delta variant, especially if schools can stay open, says Michael Shaoul, chief executive officer and founding partner of Marketfield Asset Management.

“Economic projections on the impact of delta have significantly overstated its likely effect,” Shaoul said in an interview on Bloomberg TV’s Surveillance on Tuesday. “It certainly has an impact on the speed with which workers go back to their offices in a city like New York. The biggest impact and still the biggest problem will be keeping schools open.”

Shaoul sees only a limited effect on most businesses, with travel and leisure industries disrupted but most others overcoming obstacles as they have throughout the pandemic. 

“If you try to draw a correlation between the number of infections and its impact on the economy, my feeling is the delta outbreak is going to be much, much less,” he said. “The vaccinated population is much, much less scared than it was.”

In an Aug. 2 interview on Bloomberg TV, Shaoul warned that financial markets would inevitably be concerned about inflation “at some point in time,” especially if consumers start pushing back on higher prices that retailers and product makers are passing along. In Tuesday’s interview, he suggested that time hasn’t arrived — yet. 

Even with inflation above 5%, retailers “it seems, and this is really what’s different about 2021, that they actually can still make prices,” Shaoul said. “It seems that the end consumer is willing to pay.”

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