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March 27, 2014

March 27, 2014

Don’t Miss Out To Participate On Our Conference Call

Please join Monty Guild and Anthony Danaher on March 28th at 10:00 AM PST for our conference call/webinar “Investing in the Current Macro Environment.”

On this call, Mr. Guild and Mr. Danaher will provide an analysis of the global investment markets, as well as discuss the present investing environment, global economics, and commodities.  We will discuss developments in the U.S., Europe, and emerging markets, as well as attractive sectors and industries, inflation, and markets to avoid.

The call will be approximately 60 minutes, including a Q&A session following the slide presentation.  If you are unable to attend the call, a playback will be available on our secure site shortly after the call’s completion.  Upgrade to a Gold Subscription today to be able to participate on the call. 

A registration announcement will be sent in coming days with details on how to register for the conference call.  If you have any questions, please feel free to give us a call at (310) 826-8600.  

 

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Cross-Currents Affecting the Markets

We see many cross-currents that are currently, or soon will be, affecting U.S. and European markets and the psychology of investors.

What are the positives?  What are the negatives?  What are suggested actions


Inquire About Our Investment Management Services Today

We hope you have found our weekly global market commentary useful in keeping you informed about the global macro landscape and navigating the complexity of the financial markets.

Guild Investment Management has been managing the wealth of many affluent investors since 1971.

Do you have a  seasoned investment advisor able to position your portfolio for any opportunities or to employ a defensive strategy for a market correction?

To learn more about Guild Investment Management and the services we can offer you, please visit http://www.guildinvestment.com/our-services/ or contact us at (310) 826-8600 and schedule a complimentary portfolio analysis and review.


Highly Skilled Manufacturing Workers In Tight Supply

A resurgence in manufacturing has accompanied America’s new supply of cheap energy.  The unemployment rate for workers in manufacturing has generally been lower than that for the workforce as a whole since 2010:

Manufacturing Unemployment.jpg
Data Source:  Federal Reserve Bank of St Louis

For more than a generation, young workers in the United States have seen manufacturing trades (such as welding) as dead-end jobs.  This impression may have fuelled much of the long-term pattern of the kind of post-secondary training that American workers have sought.  As an example, the graph below shows the rise in legal and liberal arts undergraduate studies compared with engineering programs:

BA Degrees.jpg
Data Source:  National Center for Education Statistics

America also lacks an effective dual-track vocational education system such as that of Germany.  There, academic undergraduate degrees aren’t the powerful focus of aspiration that they are in the U.S., and young workers are happy to progress through a vocational program and secure employment in precision manufacturing trades.  So, the relative decline in technical undergraduates is reflected even more in a decline in the population of skilled production workers.  When manufacturers were polled in 2011 about their workforce-related problems, that came up as by far the most significant issue:

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Source:  Manufacturing Institute

What are the results for young workers?  What trends will emerge?


Yuan “Carry Trade” Hits a Snag

We remarked in a recent letter about the recent reversal of the long-term trend of the appreciation of the Chinese yuan versus the U.S. dollar:

Chinese Yuan.jpg
Source: Bloomberg

In the absence of transparent Chinese government explanations of its monetary policy, outside observers are left to speculate about what’s going on.

The long appreciation of the yuan (up more than 40 percent since 2005) has helped China hold down inflation and boost domestic consumption — the latter a long-term goal of Chinese leadership as reiterated by current President Xi Jinping.  It also helped somewhat in convincing U.S. leadership that China was not manipulating its currency to make Chinese exports more competitive.

But now the “band” — the daily trading range which China allows for the yuan — has been widened, from ± 1 percent to ± 2 percent. 

So what has prompted the current reversal of the long trend?  What does this mean for the Chinese Shadow banking system?  Are they still following the same playbook?  Upgrade today, to read our full analysis.

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Guild Basic Needs IndexTM
GBNI Jan 2014.jpg

Rising cost of essential, basic needs can be tracked at www.gbni.info.


“Insider Trading 2.0.”

Eric Schneiderman, the attorney general of New York, has laid out his opposition to questionable practices by high-frequency traders, and to the special treatment they have received from some market data providers and exchanges.  In remarks at the New York Law School, he suggested new regulations to control HFT firms, as well as reasserting his intention to watch for and act against anticompetitive practices, such as the direct selling of market data to HFT firms by Business Wire and Thomson Reuters.


 

Technology and The Family Story 

The market for technological aids in discovering and strengthening one’s identity is a big one.  New startups offer cloud-based services to collect and present family stories, photographs, audio and video recordings, and other memorabilia, and many private firms offer services in tracing genealogy and establishing one’s genetic lineage.  We think this is a trend that’s likely to continue.


Market Summary

Where do we think stocks are headed in the coming months and what are we doing for our clients?  What are our thoughts about commodities?  Upgrade your subscription today to read our full analysis.

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In Last Week’s Global Market Commentary, We Also Discussed:

  • The 1980s Are Calling, and a Mini Cold War is Emerging
  • What Do Investors Need To Know About Bioprinting?
  • Agricultural Commodities and
  • Chinese Milk Demand
  • Polish Fracking

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