Imho we see stagflation in the medium term; loss of confidence in fed gov as dust settles will push people out of UST = rising private & public markets. Fundamentals get Chuck Liddell'd. Dow to 40k by 2023; Gilded Age will go on against sci-fi backdrop.
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Think it's completely diff beast than 70s. CPI useless for top 3-4% of net worths in US (& foreign investors) imho Gloves-off Fed with limitless bullets w/dollar + deteriorating faith in gov = insane upswing in markets Race to get good physical assets while the party continues
How it's the same: - tons of government spending (Vietnam/LBJ's Great Society) How it's different: - There's less demand - Oil is cheap now We could see no inflation until we get through the pandemic. I agree about gettin good physical assets but that might be RE, not equity
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rebuttal: beast perpetuating system far more entrenched & powerful now, Fed is scared animal. Q will be: hold UST or equity of most liquid powerful companies on earth. Loss of confidence in gov will directly fuel insane boom in markets. Big U.S co’s run show anyway.
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could be way off but my gut thinks this most likely plays out. We shall see my friend
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And this is why I love Twitter. These conversations right here. So now come the question of bond yields. To stifel inflation they (fed) raise interest rates?
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zero shot they raise rates unless they really lose control of inflation imho they like and need asset inflation, not CPI
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