Guild’s Basic Needs Index
Market Summary — 21 October 2021
With earnings season underway in earnest this week, we continue to see consumer-facing businesses facing mounting cost pressures from labor shortages and supply-chain constraints. A direct case in point came from Brinker International [EAT], the parent company of the Chili’s and Maggiano chain restaurants, in its recent sharply disappointing earnings
“Transitory Inflation” Gets Less Plausible, “Stagflation” Gets More Plausible: Guild Basic Needs Index Set to Top 32% Year-on-Year Rise
Yesterday, the Bureau of Labor Statistics released monthly inflation data, showing the consumer price index (CPI) for all urban consumers rising at a 5.4% year-on-year pace. In the world of official CPI reporting in recent decades, that is hot. At the same time, retirees got a reminder of their vulnerability
Market Summary — 14 October 2021
As noted above, more durable inflation is becoming clearer on the horizon, driven by hard-to-resolve supply chain issues and rising labor costs in particular. Wages are rising, particularly at the lower end of the spectrum of hourly workers, and we suspect many companies, as they report earnings, will be reporting
Erosion of the Fed’s Cred
In recent weeks, a piece of news and a piece of commentary, which we show you below, crossed our desk — items which were interesting enough taken in isolation, but which became even more interesting when taken together. Source: Wall Street Journal, Barrons The first was a report about the
Market Summary — 7 October 2021
The broad U.S. stock indices remain close to their all-time highs. However, those indices are constructed in a way that heavily over-emphasizes the largest listed companies. A different way of looking at U.S. stocks takes the average stock performance irrespective of a company’s size – and by that measure, stocks
Energy Costs Are Going Higher
Whatever else they can’t agree on — and it’s a lot — the fans of fossil fuels and the promoters of green energy solutions can agree on one thing: they all think an oil price north of $100 is a good thing. It seems that many forces are afoot in
Market Summary — 30 September 2021
Is there something strange in the water in Washington — or perhaps are we approaching the “haunted house” season where strange and scary things come out to spook us? We may not be alone; the market may be feeling the same way, gauged by its recent behavior. An electric vehicle
The Digital Transformation of Drug Discovery: Genomics, Proteomics, and AI
The economic tale of the pandemic, as we’ve often written in the past year and half, has been one where the acceleration of pre-existing trends has been remarkable — especially when it comes to technology. The after-effects of pandemic-era policies will be with us for some time — with many
Market Summary — 23 September 2021
U.S. stock indexes came close to their first real correction in almost a year (however, many individual stocks have been correcting for weeks or months). Of the selection of possible catalysts, the one that seemed to get the most attention is the fear that Chinese real estate developer China Evergrande
Water, the Forgotten Commodity
Water, and the state of U.S. drinking and wastewater systems, entered into the mind of U.S. investors during the Flint water crisis back in 2014. Since then, an acceleration has occurred in domestic water infrastructure spending, coinciding with rapid technological advancements — smart metering, the internet of things, big data
Guild Basic Needs Index Periodic Update
Goldman Sachs summarized the recent official inflation print: “August core CPI rose by 0.10% month-over-month, and the year-on-year rate declined three tenths to 4.0%… There were again signs of wage-price pass-through, with firmness in restaurant, personal care, and healthcare prices… [We] estimate that the core PCE price index rose 0.25%
Market Summary — 16 September 2021
U.S. Stocks September thus far has seen a modest decline in the S&P 500, which historically has been typical after a period of many months of positive returns. There are many potential reasons — excuses? — for the decline; but the history also suggests that after a string of positive
Biotech Beaten Down… Opportunity or Trap?
Since it peaked in February, the U.S. biotech industry has endured a slide that has taken it into bear market territory for the year. Retail investors typically approach this industry through two exchange-traded funds: the SPDR Biotech ETF [XBI], which is equal-weighted, and the iShares Biotech ETF [IBB], which is
Market Summary — 9 September 2021
In many respects, a relative goldilocks period seems to be ending. Growth, revenue, and profit recoveries have lapped pandemic lows. Further direct consumer stimulus is not forthcoming. Further broad fiscal stimulus is running up against more significant Congressional resistance, and scorched-earth warfare over the debt ceiling may be approaching. The
The Bubble Has To Pop… Doesn’t It?
Last week, we discussed the “liquidity supernova” that has helped drive global stock market indices to new highs, even in the face of many potential challenges — new covid variants, dislocated labor markets, supply chain disruptions, ominous geopolitical events, growing cybersecurity risks, uneven growth recovery, fragile internal market technicals, mounting
Market Summary — 2 September 2021
It was a great Q2 2021 earnings reporting season, as anticipated, with U.S. firms as a whole beating estimates by 19% (versus a 2% average beat over the period of 2000-2019). From this point forward, the hurdles get higher. Supply chain issues, inflation, labor problems, and consumer sentiment are all
