Guild’s Basic Needs Index
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
Why Your Market Instincts May Be Wrong
If you are a market participant who can’t shake the feeling that you have lost your touch for anticipating market behavior, you are not alone. We have taken to simply reminding investors that corrections can come at any time, which has always been true but has never been more important
Market Summary — 26 August 2021
While listening to the recent round of quarterly conference calls, we noted that most managements were still discussing supply-chain issues — and saying that these were problems that have not yet been resolved. Trans-Pacific spot shipping rates remain elevated. The Port of Los Angeles, which receives a third of all
Why Afghanistan Matters — and Why the Market Doesn’t Care
Does the collapse of the U.S.-backed Afghan government matter? It certainly matters to many Afghani individuals who hitched themselves to the American star, and seem to have been unceremoniously abandoned in the chaotic rout that passed for an American withdrawal. It matters to the population of young urban Afghanis who
Market Summary — 19 August 2021
The message from earnings season is clear: the negative earnings impact of the pandemic, index-wide, is over. The chart below shows annualized two-year EPS growth. Source: Deutsche Bank Research What remains for investors is first, not to be prematurely spooked out of a market in which sentiment and liquidity are
The Pandemic Boost to Education Technology Will Accelerate
Last week, we commented on the likely persistence of the post-pandemic “new normal” in technology, mentioning specifically remote work and e-commerce. In both cases, covid pulled forward years of technological change in the space of a few months. We believe that even though new covid variants will pose challenges, humanity
Market Summary — 12 August 2021
Two weeks remain until the Federal Reserve’s annual policy meeting at Jackson Hole, from which we may well learn more about the Fed’s intentions on monetary policy. In the meantime, we note that via various technical mechanisms, the Fed and other central banks continue to control and gradually reduce liquidity,
The New Abnormal
Really, there is only one long-term question facing investors at this juncture. Will the “new normal” that has emerged from the pandemic be enduring? Or will it prove a temporary aberration that, with however much ease or difficulty, passes and yields to the return of something more akin to the
Market Summary — 5 August 2021
We believe that inflation will hover from 3–5% for the next several years, even as it falls from June’s CPI print: 5.4% over the previous 12 months, and 0.9% month-on-month. Five Areas That Merit Your Attention Tech growth at a reasonable price: hardware, services, and software. We would be buyers
How Much China Is In Your Index Fund?
In early June, Chinese ride-hailing giant Didi Chuxing [DIDI] filed for a public stock offering on the New York Stock Exchange. To call DIDI “the Chinese Uber” [UBER] would be an understatement; in fact it might be more accurate to call Uber “the American Didi.” In the past 12 months,
