Last week, the Workout highlighted supply chain difficulties and rising costs of doing business. We cautioned that unlike the latest inflation spike, these effects may not be as transitory, with corporate resilience the key to a return to pre-covid levels. But what is the new normal? How certain are we that the pandemic hasn’t accelerated structural issues for a number of industries, and created a few new entrants? But in the new Meme Economy it may not matter. If companies such as AMC can still attract capital, how do distressed players find opportunities to deploy their massive amounts of dry powder?

Earlier this summer, it all seemed much clearer. The rate of vaccinations was fast enough to allow a full reopening and a final lifting of restrictions, amid encouraging signs of effectiveness for new variants, significantly reducing hospitalisations and deaths.

But full vaccination efforts are fading, witness recent events in Florida and the ability in stopping onward transmission and reduced efficacy for new variants is clearer. The CDC has cautioned about Delta but watch out for the more worrisome Lambda from Latam, which caused a significant spike in Chile despite a very high vaccination rate.

This has meant that the level of current activity is lower than we expected three months ago. The Economist has an excellent global study of 50 countries, their activity index is 68% of the pre-pandemic level. Cinemas and Flights remain significantly impacted.