2022 in a nutshell

Christmas, finally the time of rest, serenity, days of carefree mind, but also the end of year, customarily the time of summaries, drawing in.

2022 was a quite memorable year for me. In Poland it started off with a huge mess around the tax system reform, called Polski Ład (the Polish deal or the Polish order, or actually disorder). The modification turned out to be a spectacular botch-up making the headlines for a few weeks, until 23 February 2022, when some of us still hoped the military conflict could be averted.

On 24 February 2022 Russia invaded Ukraine. I saved first ten days of the war to posterity. I believe such notes make up the biggest value of blogging. Now, as I am writing the post, I can bring back the shock and commotion of those days. The war keeps going on and most Poles seem to have come to terms with it, which is sad, yet natural response to a critical situation.

Economy-wise, the topic of the year was inflation, predicted well in advance, materialising harshly and affecting mostly the poorest, for who dwelling upkeep and nutrition expenses make up the biggest portions of their budgets. The price level spike has been handled quite leniently by the Polish central bank, consequently we enjoy the lowest real interest world in the civilised world, somewhat below -10% (NBP benchmark rate is 6.75%, which CPI stood at 17.4% in November 2022).

As virtually all pandemic-related restrictions were lifted, I holidayed three times in 2022 – I went to the seaside on my own with my bike in May, then flew with my friends to Sardinia in late August / early September and in early November I visited Budapest with my girlfriend.

Besides, I drove twice to Wisła, where my girlfriend has her second flat, in August and then in October. I am also setting off there on Wednesday for nearly two weeks (next post due on 8 January).

In early summer I experienced the toughest depression episode in my lifetime. At first I thought it was an autistic burnout and just the effect of being somewhat overwhelmed by excessive workload, my parents’ problems with health, ups and downs in romantic relationship issues and war-related fatigue. I thought I would cope with the burnout, yet things were getting worse and lousy mood evolved into a full-blown depression. The “happiness pills” began to work around September, but in July I decided to take up therapy sessions which I should finish in January. The therapy has set me back a lot, but it was worth it, although it might not prevent another relapse of the disease.

Love-wise, I installed Tinder in March 2022, to go out with one girl for a month, give up on her. Then, upon deleting the account on the app and the very app, in June I met a girl with who I had paired up on Tinder. I thought we were anything, but a perfect match, but she carried on trying to pick me up. We met for the second and third time and it clicked. We have already had some crises, we have overcome them moved forward. Surprisingly, after being on a verge of a break-up a month ago, out relationship is stronger than before.

I keep fingers crossed for a better tomorrow. May 2023 bring us all health and joy and keep troubles at bay!

Szlachetna Paczka - the experience and a summary

022 edition was my third one as a volunteer, but for the first time I have taken up the role of an area leader. Due to influx of refugees and rising costs of living (and actually quite decent management on local level) this year’s Paczka in Ursynów was a record-breaking one. Volunteers from the area visited 84 families and took on 53 of them.

The ending was particularly tough, since the large number of families in need was not matched by a supply of donators. First 40 families found their donators easily, then it went uphill. I had to use my business relationships to find some of the donators and eventually my volunteers ended up compiling gift packages for 2 families from money collected at my girlfriend’s and mine workplaces.

In the run-up to the final weekend and during it, everything ran like a clockwork. Credits for this should go to my volunteers, carefully recruited and with a bunch of core experienced volunteers to whom I could delegate some of my responsibilities.

As the area leader I was closer to the structures of Stowarzyszenie Wiosna, which runs Szlachetna Paczka. Its backstage workings are not as dire as in times when priest Jacek Stryczek was its CEO, but still, it works like a corporation worse than my employer. As a leader I had my KPIs, deadlines and targets and had superiors checking up on my area’s progress in meeting them.

A week past the culmination of the programme, the time to slow it down comes at last. Sadly, a lot of stuff to handle was put back until after the final weekend, so now I am catching up.

In January I will take part in workshops held in order to improve the course of the Paczka in the next edition. I wonder whether Stowarzyszenie Wiosna learns from its mistakes or even whether it actually admits them. I have found some practices distasteful, but still believe the mądra pomoc (wise aid) does much more harm than good. And being a charity volunteer is immensely addictive and somehow could not imagine spending last months of the year not participating in it.

Besides, by being in charge of 26 volunteers, I have had a chance to develop my nascent managerial skills. Being a leader is not as horrible as I used to imagine and being a manager in a corporation no longer looms as a nightmare to me.

Pandemic diary – November 2022

Wednesday, 2 November 2022
Austria becomes the first country in the EU where 60.00% of population have been officially tested positive. Further rank: Slovenia (59.39% of population) and France (56.19% of population)

Saturday, 5 November 2022
Conspiracy theorist keep holding strong, though COVID-19 is nearly forgotten in the public discourse. The article about increased risk of myocarditis after vaccination against COVID-19 with patients aged below 40 is heavily cited by anti-vaxxers in Poland. They forgot to mention the risk is miniscule anyway and that risk of myocarditis as complication after the coronavirus disease is much higher

Sunday, 6 November 2022
The 7-day average number of new infections in Poland declines below 500, for the first time since 4 July 2022. Positivity rate in turn has fallen below 10%.

Thursday, 10 November 2022
Oddly enough, the number of daily death worldwide has not fallen below 1,500 for a month. This implies infections do not decrease, but more and more countries give up on testing.

Friday, 18 November 2022
The 7-day average of new infections in Poland bottoms out at 318, with positivity rate somewhat below 10%.

Saturday, 19 November 2022
I go through the most severe cold since 2012. This is not COVID-19 (tested twice), but it turns out two years of masking up, isolation and averting germs have taken their toll on immunity.

Wednesday, 23 November 2022
The number of tests carried out per 1 million citizens in Poland reaches… 1,000,000. Poland remains at the bottom of the ranking of EU27 countries which best test their citizens, although truth be told testing has been abandoned in several civilised countries.

Wednesday, 30 November 2022
The next wave apparently has begun, with week-ok-week increases in new cases above 20%. The winter is coming.

Next week comes the final weekend of Szlachetna Paczka, so the next post will appear in two weeks.

Are we past the trough?

Had I been really good at economic forecasting, I would have been much richer, worked less and probably had more time to indulge in hobbies, including blogging. Sadly, predicting economic variables is, needless to say, subject to a lot of uncertainty. Time permitting, I keep track of what is going on in the real economy and on financial markets and spot some sparkles of optimism.

Stock markets, which usually anticipate economic recoveries, have rebounded recently, with the Warsaw Stock Exchange broad market index being some 20% above its low from early October. Some pundits warn it is just a major correction in the bear market, yet upbeat sentiment has definitely taken over recently.

Natural gas and electricity prices on commodity exchanges, though still volatile, have fallen off peaks from September. With natural gas storage facilities across Europe full, the threat of a severe energy crisis has been somewhat staved off. This also gives relief to entrepreneurs from who energy is an important item in the cost structure, except for those who hedged purchases at peaks.

Commodity prices have also adjusted to lower demand, which means, the demand for them might not necessarily fall. Brent crude oil now costs (in USD) roughly as much as before Russia invaded Ukraine.

The last glimmer of hope are PPI (producer price inflation) readouts, which signify decreasing cost pressure for entrepreneurs, which will with a delay of a few months should translate into lower consumer inflation.

Not all signals from the economy are bright. Profits of companies after 3Q2022 keep falling dramatically, which might hamper their investment plans and necessitate lay-offs.

Consumer confidence in Poland is also record-low, with wallets of ordinary people badly hit by prices of most basic goods rising faster than general inflation (+17.9% in October 2022). With negative real average wage growth (around -4% y/y) the discretionary spending must plummet and so far nothing indicates private consumption could recover soon.

Across Europe a big unknown is the threat of energy shortages during the winter. I lack competencies to assess how real that threat is, but if only the most energy-consuming industries are forced to suspend productions, effects of negative supply shock will spill over the entire economy, send inflation up.

In Poland much depends on the influx of refugees from Ukraine, where the Russian tyrant is trying to destroy the infrastructure to deprive civilians of electricity, heat and water during the winter.

Even if the worst has not come over, I believe it is a matter of a few months. Roll on spring!

The warfare has reached Poland

The accidental missile strike incident which took place on Tuesday, was just a matter of time. Given the scale of warfare so close to the Polish border and probability of a human error, the question was not if, but when it would happen. The areas near the Ukrainian border are not densely populated, so it took more than a bit of bad luck that the missile hit grain storage facilities during its working hours. The two men working there were the first Polish civilians to have become the casualties of the Russian invasion.

The Polish government convened quickly in an emergency mode to discuss the event and its implications, while holding off on any public commentary. While many detracted from their restraint, I can praise them for not saying a word too much and refraining from jumping to conclusions. Nevertheless, the official silence gave rise to a flood of fake news on social media, particularly on Twitter. The incident gave the Russian trolls an excellent opportunity to sieve misinformation; the opportunity they instantly grabbed.

Also the foreign press agencies added up to the informational chaos, quoting unverified alleged statements of intelligence officers. On top, the Ukrainian president Zelensky did not act up to the mark, by making unfounded claims the missile was shot by the Russian army. No civilised man blames Ukrainians who defend their territory against the aggressor for the death of two men, but they should not depart from the truth. The president Biden has rightly reproached Mr Zelensky over his premature assertion. Hope the Ukrainian head of state learns from his mistake and avoids next diplomatic botch-ups.

In the first hours past the incident I wondered if NATO passed the test it had been put to. With hindsight I believe senior military officers have acted considerately and held back from overreacting of what had definitely not been an attack on the territories of the alliance.

Sadly, the scenario which I envisaged a few weeks ago, i.e. that Russia will be destroying Ukrainian infrastructure to provoke a humanitarian disaster in colder months, is materialising. Even if the hell of warfare comes to an end (with Russia being defeated, no other outcome can be imagined), it will take a few years before Ukraine recovers from losses and decades before wounds in Ukrainians’ heart heal.

Budapest

I had long yearned to visit the capital of Hungary, yet there always used to be some obstacles on my way. In early October my girlfriend urged me to take a short foray abroad before the end of 2022. I had to forego my reluctance to support in any way the authoritarian regime of Mr Orban (just as in 2019 I renounced my resolution to never invest in government bonds – this has paid me off well, with superior coupons on inflation-linked gilts).

The cost of cheap airline tickets (return ticket with no small hand baggage for mere PLN 130 – such expense does not discourage from flying) and accommodation (PLN 128 per person per night) were actually the only outlays which did not hit the wallet. Maybe except for public transport tickets which were reasonably cheap.

Inflation in Hungary exceeded 20% and this is felt, even after the Hungarian forint depreciated against the Polish currency. Especially the entry tickets to sights had steep prices, but if one wants to get to know the city, such expenses must be borne.

The weather in early days of November was quite nice, with temperature in between +10C and +15C most of the time and hitting +20C in the afternoon on 2 November. If I was to pick one word to describe Budapest, I would choose “drab”. Drabness of the Hungarian capital, nearly everywhere, except for most splendid tourist destinations, is eye-popping. But while taking pics, I attempted to catch the more pleasurable atmosphere of the city.

To the right – a view at Danube river and the edifice of parliament in the distance, as seen from the ascent to the Gellert Hill. The pic taken around an hour before sunset.

The beautifully illuminated parliament building is the iconic landmark of Budapest, looking much better in the darkness that during daylight.

Inside, the building is decorated in typical Austro-Hungarian lavish style, with lots of gold and paintings. The lavishness is actually overwhelming.

The basilica in Budapest, built in the middle of the nineteenth century, also had its wall, ceiling and domes splendidly adorned. This time round I took some effort to tweak with settings of my camera, which had a visible positive impact on the quality of shots.

The basilica has a viewing terrace which overlooks the city which lacks skyscrapers. Here, a view on the Fishermen’s Bastion, the pic taken with > 10x optimal zoom, hence the blob (I lack time to process snaps in the photoshop).

Andrassy Street is definitely the high street of Budapest. The view in which all lines converged towards the horizon took my fancy, hence I bothered to snap the alley…

…From the Victory Square which, like many spots in the Hungarian capital commemorates year 1896 when Hungary celebrated a millennium of its existence. The square brings to mind sights of Berlin…

Another lavish interior is the biggest synagogue in Europe, not destroyed during WW2. It was my first visit to a Jewish temple, set me back nearly the equivalent of PLN 100, but given the expense was one-off, it was worth it!

I also thoroughly recommended the thermal baths in Budapest, yet for obvious reasons, I did not take any photographs there.

Now time to focus on Szlachetna Paczka – less than 4 weeks left before the final weekend and lot of hard work to be put in ahead of my team and me.