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Childhood Obesity is Surging Around the World Amid Pandemic

Childhood obesity has been increasing around the world for decades, but the pandemic lockdowns have hastened the rise. A recent study indicated that in 2022 the number of obese children worldwide would surpass those that are underweight for the first time in history. Many think that obesity is only a problem in wealthy countries but in fact, 27 percent of obese children under 5 years old are in Africa and 48 percent are in Asia. In wealthy countries, obesity is more common in poor families who don’t have the money or access to healthier options, while in developing countries it is the emerging middle class that are becoming overweight.1 Lawmakers are expected to create new regulations on this topic by requiring more nutritional education and physical exercise at schools and increasing taxes on sugary foods.

Global Food Prices Highest in Nearly Half a Century

As has been the case for a vast array of goods, global supply chain disruptions stemming from COVID-19 have helped to drive an increase in the price of food. However, extreme weather has also had a hand in pushing average global food prices in November 2021 to their highest inflation-adjusted levels in 46 years, according to data from the United Nations Food and Agriculture Organization.2 Heat and drought wreaked havoc on the wheat harvests in the northern plains of the U.S., while hurricanes disrupted U.S. fertilizer production resulting in higher prices for a key agricultural input. On the other side of the Atlantic, high natural gas prices have also contributed to a major run-up in fertilizer prices. With food prices high and expectations for drawdowns in global grain stocks over the course of 2022, increasingly frequent extreme weather events loom as a threat to global food supplies in the coming year.2

Biotech Stocks Struggled in 2021

In a risk-on year where almost all risky assets from stocks to commodities to cryptos appreciated sharply, the struggle of biotech stocks in 2021 is eye-catching. XBI, the ETF proxy for small-to-mid cap biotech stocks, plunged 20 percent while IBB, the ETF proxy for large cap biotech stocks, barely broke even. The Russell 2000 Health Care sector was the only money-losing sector (-18 percent) in the Russell 2000 and it caused the overall index to trail the S&P 500 sharply for the year, +14.8 percent versus +28.7 percent.3

Several factors were to blame for the biotech stocks struggle. First, investors moved away from once popular, high-flying stocks with little earnings and high valuations. Since many small-cap biotech companies have no earnings and some don’t even have revenues, they were deserted by investors and their stock prices nosedived. Second, IPO’s had a record year in 2021 and the flood of new public companies drained away investments into biotech stocks. Lastly, the regulatory uncertainties regarding drug prices and potential antitrust legislation also hurt investor sentiment towards biotech stocks.3

Lower Expected Returns

While 2021 proved to be a volatile year for equity markets, the year ended with strong performance from most major indices. Despite the strong recent performance, many are concerned about lower returns going forward, citing unattractive valuations and unsustainable growth due to central bank intervention as the primary cause.4 Many worry that these factors have created a less favorable investment environment for younger generations, such as millennials and Gen Z. One study predicted that Gen Z could see an annualized return of 2 percent from holding a portfolio consisting of 70 percent equity and 30 percent fixed income.5 Given the start of a new year, it may be beneficial to recalibrate investment expectations and prepare for lower returns over the next several years.

Worldwide COVID-19 Response

Economies across the world have rebounded from the lows of the pandemic in early 2020, but responses to the challenge have been as different as the countries themselves. In Japan, unemployment barely moved as the virus’s impact was negligible. Spain and other countries in southern Europe, which were vulnerable to shutdowns due to their reliance on tourism, have lagged. In the U.S., Canada, and Britain large amounts of debt were incurred for fiscal responses to mixed economic results.6 Moving forward, winners and losers will continue to be determined based on policy. The chasm between them could widen.


  1. Slavea Chankova, “Obese children will outnumber the underweight for the first time,” The Economist, November 8, 20211, https://www.economist.com/the-world-ahead/2021/11/08/obese-children-will-outnumber-the-underweight-for-the-first-time
  2. Jeff Masters, “Extreme weather and pandemic help drive global food prices to 46-year high,” Yale Climate Connections, December 6, 2021, https://yaleclimateconnections.org/2021/12/extreme-weather-and-pandemic-help-drive-global-food-prices-to-46-year-high/
  3. Brad Loncar, “Here’s What Happened to Biotech This Year,” Nasdaq.com, December 28, 2021, https://www.nasdaq.com/articles/heres-what-happened-to-biotech-this-year
  4. Aaron Saldanha and Divya Chowdhury, “’Black Swan’ hedge fund sees lower returns from risk capital,” Reuters, December 16, 2021, https://www.reuters.com/markets/stocks/black-swan-hedge-fund-sees-lower-returns-risk-capital-2021-12-16/
  5. “Young people stand to make dismal returns on their investments,” The Economist, March 15, 2021, https://www.economist.com/graphic-detail/2021/03/15/young-people-stand-to-make-dismal-returns-on-their-investments
  6. “Which economies have done best and worst during the pandemic?,” The Economist, January 1, 2022, https://www.economist.com/finance-and-economics/which-economies-have-done-best-and-worst-during-the-pandemic/21806917

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