Perspectives

The senior living sector is experiencing stress on various fronts, as we set forth in our June 29th post. Occupancy contraction, increasing costs and high leverage have converged to create crises for a huge percentage of industry participants

Many economic models are changing, and we want to call your attention to the adult care industry – nursing homes, rehab centers, retirement communities.  Nursing home bankruptcies will present numerous risks and opportunities for investors in the coming cycle. 

Time to Pay the Piper? A Look at the Prospective Cost of Capital In the first three installments of this series, we made the point that the corporate cost of capital has nowhere to go but up.  But what does … Read more

Time to Pay the Piper? A Look at the Prospective Cost of Capital In the first two installments of this series, we made the point that the corporate cost of capital has nowhere to go but up.  But what does … Read more

Related to our ongoing series on the cost of capital, we wanted to highlight notes from a recent webcast with James Grant, founder and editor of the Interest Rate Observer.  Grant makes several salient points regarding inflationary trends in the US and the impact the Federal Reserve’s necessary response will have on U.S. markets. 

Time to Pay the Piper? A Look at the Prospective Cost of Capital In the first installment of this series, we made the point that the corporate cost of capital has nowhere to go but up.  But what does this … Read more

In the first in a series about the cost of capital, Gordian employees discuss the impact US monetary and fiscal policy has had on interest rates and asset prices and lay the ground work for how those actions may affect future government policies, valuations and investment decisions.

In the aftermath of the Presidential Election, we wrote a piece discussing some of the economic challenges facing the Biden Administration, and how Biden’s actions may stir inflation and create sets of corporate winners and losers. Now that the Biden team has started to implement its agenda, we thought it would be interesting to revisit these issues.

In the aftermath of the Great Recession, governments have actively depressed bond yields and inflated bond prices.  Unfortunately, most market manipulations ultimately meet a messy end.  If and when this particular manipulation goes the way of all flesh, yields will rise and bond investors will lose money.  Bonds would stop being effective investment instruments, and become “Certificates of Confiscation”.

Unlike Scrooge’s deceased business partner, Marley, we don’t believe that inflation has met the same fate.  It is subdued, but lives.  Despite the contentions of Modern Monetary Theorists (MMT), we disagree that the US can continue printing money without consequences.

In the aftermath of the November elections, we thought it worthwhile to revisit the economic and market risks Biden is facing. Plus, The pandemic is far from over, but COVID’s shattering effects on consumer behavior will be with us for a very long time to come.