When it comes to the supply chain, few things have captured people’s imaginations more than last year’s shipping queues off of the California coast. While those lines are long gone, the supply chain is not only worse off today, but quickly approaching a near and total logjam. Production in China Let’s examine today’s supply chain […]
Written by: Dillon Zwick Edited by: Jon Nash In the early 1980s, the junk bond king Michael Milken and his investment banking firm Drexel Burnham Lambert ran into a difficult problem: they were too successful. They were so good at selling junk bonds that they ran out of junk bonds to sell. To solve this […]
Currency Crisis and Dollarization In the past few months, there have been a lot of discussions about de-dollarization in response to the weaponization of finance, but in the markets, we have seen the exact opposite. Since November, the dollar index is up 8.5% and continues a precipitous rise. So, What’s Going on? Over the past […]
The rapid increase in food prices will be one of the biggest challenges of 2022. In 2021, US grocery prices rose 7%, while world food prices jumped 28%. Absent substantial government intervention, global food prices are on pace to reach all-time highs during the spring harvest. Cost increases are being driven by Covid, labor shortages, […]
The US economy, while recovering, is now at a pivotal juncture. We are facing both slowing growth and increasing supply-side inflation. The Federal Reserve Board (FED) has to decide between two different paths, maintain its dovish easy money policy in an attempt to keep growth strong or switch to a hawkish path of less stimulus […]
We are on the precipice of two global crises that will have significant bearing over the next decade: the climate crisis and the sovereign debt crisis. According to the most conservative models, the climate crisis will cause historic and unpredictable weather patterns, endangering supply chains and the food supply. The result will be increased food […]
In 1944, the Brenton Woods agreement established the US Dollar as the global reserve currency, with all other currencies pegged to the dollar. That link came undone in 1971 when the US went off the gold standard, which caused all currencies previously tied to the US Dollar to have free-floating exchange rates. The initial result […]
This article is the first in a three-part series on the global macro trends that will likely dominate the business environment over the coming decade. Each part of the series will examine the most significant and interrelated challenges facing businesses recovering from the pandemic: Demographic decline, global supply chain restructuring, climate change, and sovereign debt […]
Out Of The Frying Pan Into The Fire Let’s talk about lumber. During the past year, Covid restrictions kept labor at home and temporarily throttled the production capacity of US and Canada sawmills. But, demand remained strong or grew as people working from home pursued improvement projects. The sawmill downtime depleted wholesale and retail inventories […]
The Road to Recovery Our forecast from last May outlined the four stages of economic distress that we anticipated would develop as a result of the COVID 19 pandemic. Those four phases were: 1. The Great Pause 2. Cashflow Deterioration 3. Cascade across markets 4. The New Normal That forecast was based on the history […]