Guild’s Basic Needs Index

Market Summary — 3 June 2021

As we noted in our main piece this week, we believe it’s very important for investors to revisit their commodity allocation now, while rising inflation is still in early innings.  We’re cautious on some commodities that have run recently, such as copper and iron ore, and while we still like

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Taiwan: Critically Important Flash Point

One lasting effect of the pandemic’s disruption of global supply chains has been a shortage of chips. This is not primarily a shortage of the advanced semiconductors which some industry leaders have increasingly favored because of their higher margins; rather, it’s the commoditized, workhorse chips that are now essential components

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Market Summary — 27 May 2021

Various Fed officials, including Vice Chair Richard Clarida, have taken to the airwaves to talk down inflation concerns and show confidence in the Fed’s ability to engineer a “soft landing” when the time comes to curtail pandemic-era policy. This has given markets a tone of uneasy quiet. Economist Mohamed El-Arian

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All Eyes on Wage Inflation

At this point in the post-pandemic recovery, a lot depends on who is right in the very lively “transitory vs. persistent” inflation debate.  For investors, the question is particularly sharp.  If you believe that Fed Chair Powell and Team Transitory are correct, you will position your portfolio quite differently than

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Market Summary — 5 May 2021

The correction we have been expecting for some time is now underway. Inflation Breakout: Demand Pull Moving To Cost Push Inflation has broken out and gold has broken out to a two- or three-month high.  We suggest that investors use dips to buy gold, silver, copper, and other industrial metals

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Inflation, Interest Rates, & Gold, Oh My!

April inflation data came in hot, as we’ve been predicting for months.  By bringing you our Guild Basic Needs Index, we have been preparing you for some of the eye-popping numbers you will see.  Year-over-year, lapping last year’s first full month of pandemic lockdowns, prices rose 4.2%.  But month-over-month, overall

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March Data Show Inflation Is Still Climbing

A month ago, as inflation talk claimed more investor attention, we revived our in-house inflation index — the Guild Basic Needs Index — which was designed as a simple and straightforward snapshot of the on-the-ground inflation picture faced by consumers, not gamed or massaged by statistical sleight of hand.  (If

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Earnings Growth: Is This As Good As It Gets?

Earnings season is a busy time at Guild, since our management style emphasizes the careful selection of individual stocks rather than broad indices.  That means that we typically have two or three dozen company conference calls to listen to; we find that significant details are often neglected in the summary

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Market Summary — 6 April 2021

Rising inflation expectations may be even more important for investors than rising inflation.  These expectations are forcing individual investors and money managers to include a new factor in their models and strategies that has been absent for the better part of two generations.  Notably, expectations are essentially aspects of human

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Commodity Price Drivers: The Rational, the Irrational, and the Unpredictable

Many commodities have boomed, driven by a confluence of forces: ongoing monetary and fiscal stimulus; accelerating post-pandemic global economic growth; long-term underinvestment in commodity production capacity; pandemic-related supply chain and shipping disruptions; the rise of sustainability metrics for public companies; the push for decarbonization and the electrification of the global

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Market Summary — 29 April 2021

As we continue to lap the initial stages of the pandemic, a lot of numbers are going to start showing year-over-year peaks: GDP, earnings growth, inflation.  Looking forward, everything may start to look like deceleration — and since the market is a discounting mechanism that looks out to the future,

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Will the Feds Ban Bitcoin?

Last week we wrote about the advent of central bank digital currencies, outlining the motivations that governments and central banks have for upstaging the rise of decentralized crypto networks such as bitcoin and Ethereum.  This week we’ll take a look at a trend in communication from fiscal and monetary authorities,

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Market Summary — 22 April 2021

The overall market indices in the U.S. have moved sideways, near all-time highs.  Many former high-flyers have corrected, with formerly exuberant cryptos and SPACs registering volatility and declines, suggesting that the market is already experiencing a sector by sector correction.  The S&P 500 may see more correction soon, perhaps registering

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Market Summary — 15 April 2021

While we remain bullish on the U.S. market longer-term, the market is obviously ready for a normal correction.  This correction may only be a 5% pullback, or it may be slightly more.  Therefore we have held some cash and short positions in order to hedge out the risk and provide

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The Boom Arrives on Main Street

As we noted last week, we believe that as 2021 progresses, we will have a drumbeat of increasing analyst expectations for GDP growth and economic activity.  The past year’s pandemic-driven economic gyrations have been so severe that economists and macro strategists — who as a group are not the most

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