Green hydrogen is a hot topic nowadays, leaving many to wonder how important a role it will play in the future as an energy source to heat homes, run factories, and advance vehicles. Green hydrogen, also referred to as “clean hydrogen,” is a clean burning fuel that has significantly low carbon emissions.1 This is among its main differences from grey hydrogen, which is produced using fossil fuels such as natural gas or coal.
China is one of the world’s most populous countries. In 2021, China recorded the largest population in the world at 1.412 billion. Since 2022, the population has been steady but is expected to see a continuous decline starting in 2024 (Figure 1).1 The decline in the population of China is due to several demographic challenges that require attention. Prominent among them, and largely a result of the COVID-19 pandemic, is a high youth unemployment rate. This, coupled with long-term challenges such as an aging population and lower birth rates are leading to uncertainty over China’s economic future.
This morning the U.S Bureau of Labor Statistics released the January Employment Situation Summary, better known as the Jobs Report. This was a blowout number and starts off 2023 with surprisingly strong job creation.
Energy has been central to many conversations we’ve held in 2022, and for a good reason. Oil and Natural gas prices have fluctuated widely in recent years1 . Additionally, nearly every aspect of the average American’s day touches the energy industry in some form, whether driving a vehicle or simply turning on a light switch. We focus our energy research efforts on understanding some key areas: Global Perspective, Supply and Demand, Production and Consumption, Inflation, and Opportunity. Understanding these dynamics allows some clarity in an otherwise noisy environment.
Historically, gold has been prized by investors for its relative stability through tumultuous markets and its resilience, even outperformance, in the face of significant inflationary pressures. Being a tangible commodity in limited supply, the precious metal has intrinsic qualities shared by other real assets that have usually been better able to weather above average inflationary environments. Additionally, gold exhibits low, occasionally negative, correlation to most traditional assets like equity and fixed income, and thus provides a significant degree of diversification when markets experience volatility.
Amid heightened market turbulence fueled by increasing uncertainty over slowing economic growth, persistently high inflation, and rising interest rates, investors have rightly grown concerned about capital preservation within portfolios.
The first half of 2022 saw the S&P 500 post its worst return through June in more than fifty years and the Bloomberg U.S. Aggregate bond index record its largest quarterly loss since 1980 before tumbling further into what the New York Fed described as one of the fastest, deepest, and longest bond selloffs in four decades. Needless to say, it has been a difficult environment for investors this year.
Stagflation is defined by stagnant economic growth and elevated inflation. A stagflationary environment is particularly problematic for investors, harming both equities and fixed income. The combination of higher inflation and lower growth can erode profit margins, especially for companies that are unable to pass on higher costs to customers, causing corresponding weak equity market performance.
Both stocks and bonds are off to one of their worst starts to the year in history. The S&P 500 Index declined -12.92% through the end of April, and other broad market indices were similarly down double digits.1 What’s worse, investors are losing nearly as much on the fixed income side of their portfolios as they are on the equity side.