Friday, May 7, 2021

This week's interesting finds

 Earnings, losses and relative returns 

Why interest rates are rising 

If you combine that fact with excessive US money supply growth and massive excess savings you can understand why investors feel unsettled. Without doubt, the almost absurd rise in excess savings everywhere is a result of the lockdown(s). Consumers have simply not been able to spend what they would have spent under normal circumstances, hence the big war chest building up.

The combination of those three factors – rising wage growth, rapid money supply growth and huge excess savings – can only lead to higher inflation (say the bond bears), hence the rise in bond yields. Officials at the Federal Reserve Bank don’t disagree with that but, importantly, they argue that the rise in inflation will be transitory and that inflation will begin to fade again in 2022, hence why they don’t need to act (they say). Only time can tell who is right and who is wrong. 


 About 44% of older millennials born between 1981 and 1988 report having been diagnosed with at least one chronic health condition, according to a recent survey. 

Canadian oil companies set self-imposed penalties if they don't meet sustainability targets  

Canadian oil sector companies are willing to pay more interest on their debts in exchange for more environmental, social and governance credit from investors. 

In a first for the North American energy industry, midstream company Gibson Energy Inc. announced a sustainability-linked credit facility. Gibson’s sustainability targets include a reduction in emissions and also an effort to boost diversity at the oil storage and pipeline company — as energy companies try to improve their credibility on the S and G components of ESG. 

Used car prices seem primed for another spike based on JDPower Auction data.

Red line indicates used car auction data pricing. The blue line indicates used car prices. Used car auction data pricing is a leading indicator of used car prices. 

Rents have started climbing meaningfully

Source: ApartmentList data

Massive spike in mentions of “inflation”.  Many of the mentions relate to rising commodity prices, but also scarcity of workers despite elevated unemployment. 

The sure-fire way to get out of debt