Guild’s Basic Needs Index
Wage Inflation and Poor Productivity Growth — and the Industries They Will Challenge
Another week brings another set of inflation-related data to report on. In the past few days, we have seen consumer (CPI) and producer (PPI) inflation data from the U.S., Europe, and China. (When our October data are complete next week, we’ll give you an update on our in-house real-world inflation
Market Summary — 11 November 2021
If only everything were linear and two-dimensional, the investor’s task would be a lot simpler. The inflation, margin, and productivity trends noted above would be easier to translate into predictions. Unfortunately there are confounding factors which make the problem multidimensional, non-linear, and much more unpredictable. Among the most significant of
Inflation, the Cost of Doing Business, and Labor Flexing Its Muscles
Businesses are facing rising costs, and it remains to be seen how “transitory” those will be. The consensus among analysts and officials has been gradually coming to the point of view we have had since early in 2021 — that inflation would be much stickier than their earlier hopeful (and
Market Summary — 4 November 2021
The Federal Reserve, as expected, announced its intention to begin tapering its $120-billion-per-month asset purchase program, by $15 billion per month. The market’s response — with the S&P 500 closing the day at an all-time high — shows that the move was already largely priced and anticipated. Investors will still
Inflation, Chaos, and Regime Change
Last week, on the occasion of the 50th anniversary of our firm, we reflected on the many ways in which current events and trends “rhyme” with the events and trends of the early 70s — from war and energy convulsions, to political turmoil and demographic transformation, to monetary chaos and
Market Summary — 28 October 2021
Spot uranium marches on. Source: Business Insider Although the current price spike is likely to be an unsustainable artifact of labor and supply chain disruption, uranium is an unavoidable necessity in the drive for decarbonization. It is relatively abundant and extremely energy-dense. Fission power plants have microscopic footprints compared to
Happy 50th Birthday, Guild Investment Management!
On October 16, 1971, after years of investing for himself and working as an analyst at a hedge fund and in bank management, our founder, Monty Guild, established his own private investment portfolio management practice. That practice continues today as Guild Investment Management, Inc. For 50 years, Monty, and all
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
