‘These have resulted in shortages across many industries, from semiconductors and fertilizers to solar panels and, yes, even glass for booze bottles,’ he says. He cites issues around port and factory closures in Asia, backlogs at US ports that became a White House issue, energy supply chain problems in China and Europe, and more. ‘No one talks about them until for some reason everyone talks about them.’ This was a dynamic Sentieo saw play out during the pandemic twice, he explains: ‘Once in early 2020 as the virus was taking off, and with another spike in the second half of 2021, for different reasons.’ ‘Supply chains are a bit like air,’ states Mazing.
And I think markets and market participants are beginning to realize that this is much more pervasive and likely more persistent than expectations were going back three or six months.’ We saw a consumer price inflation number today north of 6 percent. He says the November comment from Blackstone’s chief operating officer Jonathan Gray sums it up nicely: ‘I think the biggest challenge by far is what’s happening with inflation. ‘Sentieo saw transcripts mentioning inflation jump to almost 2,000 in November 2021, versus a few hundred per month in recent years,’ explains Mazing. While central bankers first described it as transitory, he notes that the recently reappointed Fed chairman Jerome Powell suggested it is time to ‘retire’ the word ‘transitory’. And this is particularly true for Unilever because of our uniquely wide geographical reach.’īroad-based inflation increased globally in 2021, says Mazing. Mazing points to a comment from Alan Jope, Unilever’s CEO, on the Q3 call in October: ‘Although life for many of us is starting to normalize, we are operating in a global environment that is far from business as usual.
‘We saw more and more transcripts with the word ‘normalize’ in 2021, continuing the H2 2020 trend,’ he says. The idea of a return to normal was already on the radar in the second half of 2020 and Mazing describes the vaccination rollout across the developed world as giving rise to ‘persistent optimism, despite setbacks’ such as the Delta variant of the coronavirus. Click on the charts to go to a larger, live version. Nick Mazing, Sentieo’s director of research, takes IR Magazine through a year in charts.Īll data supplied by Sentieo. Inflation, supply chain issues and an ever-greater focus on ESG and net-zero have been on the minds of investors – and on the corporate earnings call. While we’ve all adapted to our local normal, other issues have clearly shaped the year.
With the new Omicron ‘variant of concern’ and countries changing restrictions daily, it’s debatable just what that normal is likely to look like, of course. Many in the developed world are now double, if not triple, vaccinated and this year has seen much talk of the return to normal. If 2020 was the shocker (first) year of the pandemic and all that it entailed, then perhaps 2021 was the year of Covid fatigue.