Many investors worry about the debt-to-GDP ratio when evaluating a country’s economy. For example, the US national debt is over $34.5 Trillion according to the US Treasury. The debt-to-GDP ratio stood at 124.7 % of the nominal GDP in March 2024. The record low was at 31.8%. The cost service the debt amounted to 2.4% of the GDP in 2023. In terms of dollars, total net interest payments was $658 billion in 2023. This figure is indeed small when compared to other countries. The key point is ability to service the debt and not the total debt outstanding. I came across the below chart that compared the debt-to-GDP ratio against the interest payments to government revenues for select countries in 2023:

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Source: The demographic wave: The tide is going out, Franklin Templeton Institute

For many developing and frontier countries, the debt-to-GDP is not only high but the servicing cost of the debt is also high. For instance, Angola spent 24% of its revenue to service its 85% debt-to-GDP ratio. Or to put it another way, nearly one-fourth of its revenue went to interest payments. For Italy on the other hand, debt servicing cost was just 8%. So this gives the country the ability to access further credit unlike Angola. For India and Mexico, servicing cost was over 27% and 23% respectively in 2023.

Fast food used to cheap in the US many years ago. That is no longer the case. Fast food which is basically “junk” and unhealthy food has become incredibly expensive in the past few years especially since the pandemic. Multiple factors have led to menu prices soaring. These include higher labor costs, inflation, rising food costs, increasing commercial rents, insurance costs, etc. I came across the following chart that shows how fast food prices have outpaced inflation since 2014:

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Source: @MichaelAArouet via syz Group

Higher food prices have not led to a significant decrease in sales among the major chains. However due to rising consumer backlash McDonald’s for instance is launching a $5 meal in June for a month. Burger King is also joining the battle with a $5 meal.

In terms of stock returns, Chipotle Mexican Grill(CMG) is the best performer YTD and also in the past 5 years as the charts below show:

Select fast-food restaurant stock returns YTD as of May 24, 2024:

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Select fast-food restaurant stocks 5-returns as of May 24, 2024:

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Source: Google Finance

Related Companies:

• Chipotle Mexican Grill Inc. (CMG)
• McDonald’s Corporation (MCD)
• Restaurant Brands International Inc.(QSR)
• Wendy’s Company (The) (WEN)
• Yum! Brands Inc. (YUM)

Disclosure: No positions

Islam is the second largest religion in the world after Christianity. Around 1.8 billion people are followers of Islam. Indonesia has the largest number of followers followed by Pakistan and India. Similar to other religions, Islam also has multiple sects and sub-sects with Shia and Sunni being the major sects. Recently I came across the below infographic that shows many interesting details about Islam:

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Source: Information is Beautiful

In 2013, US-born computer contractor Edward Joseph Snowden released classified documents that revealed details on the many secret surveillance programs run by the US and other governments spying on their own citizens and others. Recently I came the below interesting magazine cover that ran the cover story on this topic:

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Source: Frontline