haven't low rates been primarily a function of weak demographics (slowing working age population growth), lack of productivity, and debt (i.e. constrains how how rates can go)? globalization was a disinflation force via wage growth competition as was free trade (i.e. comparative advantage), but other big constraints too....especially in europe.
Hi Russell. Thank you for your interesting insights.
Could you please expand on what indicators or data tell you that this policy change is taking effect? Which governments are doing it? What are the exact mechanisms they are using to keep the exchange rates tight?
Also, could you elaborate about what is the timeframe you expect these policy changes to take effect?
Curious to hear your thoughts on the debacle going on in Japan right now. Is there a scenario that should the Yen destruction keep going - will they be forced to sell their USTs? I'd imagine this would be the trigger that would take bonds to new lows after the recent run-up
Thank you Russell for the great content and excellent insight as always. A few points I want to add that hopefully you find as interesting as I do...
1. CPI says housing costs rose 5% in the last 12mos. I would argue it should be closer to 12% given the NAR data available. Bureau has smoothed out housing prices and will do the same to vehicle prices starting next month. Inflation is being understated.
2. I strongly believe the Fed has no intention of fighting inflation. These half point hikes we see every FOMC meeting are only helping the Fed keep its head above water, waiting until stocks and the consumer collapse. The Fed only cares about reloading its monetary rocket launcher so it can rescue the economy again and again.
3. American real wages adjusted for inflation seem to be the only thing thats down in this manic market. Inflation is a massively regressive tax.
4. Profit margins will fall during inflationary periods. Early in an inflation pricing power runs ahead of sticky wages/ supply contracts, but inflation always has the last laugh.
Love the title (and the content)
haven't low rates been primarily a function of weak demographics (slowing working age population growth), lack of productivity, and debt (i.e. constrains how how rates can go)? globalization was a disinflation force via wage growth competition as was free trade (i.e. comparative advantage), but other big constraints too....especially in europe.
Hi Russell. Thank you for your interesting insights.
Could you please expand on what indicators or data tell you that this policy change is taking effect? Which governments are doing it? What are the exact mechanisms they are using to keep the exchange rates tight?
Also, could you elaborate about what is the timeframe you expect these policy changes to take effect?
Curious to hear your thoughts on the debacle going on in Japan right now. Is there a scenario that should the Yen destruction keep going - will they be forced to sell their USTs? I'd imagine this would be the trigger that would take bonds to new lows after the recent run-up
Thanks for your article. So given we are under such a high inflation circumstance, should we short usgg10yr and long ? Commodities?
I´ve always liked you Russell, you have charted a steady course on a Sea of Prevarications.
But you are way off, and this explains Why in 177 Words: https://www.talentseekscapital.com/uploads/3/4/5/6/34567939/manipulation.pdf.
This also explains the Devastating Dynamics at work: https://www.talentseekscapital.com/uploads/3/4/5/6/34567939/generations.pdf.
Get in Contact if you would like to do something Together to Profit from What is unfolding.
If not, I wish you well and urge to take heed to the links I have included.
Hate to see Good Men lose from Bad Policies.
Regards, Charlie.
Thank you Russell for the great content and excellent insight as always. A few points I want to add that hopefully you find as interesting as I do...
1. CPI says housing costs rose 5% in the last 12mos. I would argue it should be closer to 12% given the NAR data available. Bureau has smoothed out housing prices and will do the same to vehicle prices starting next month. Inflation is being understated.
2. I strongly believe the Fed has no intention of fighting inflation. These half point hikes we see every FOMC meeting are only helping the Fed keep its head above water, waiting until stocks and the consumer collapse. The Fed only cares about reloading its monetary rocket launcher so it can rescue the economy again and again.
3. American real wages adjusted for inflation seem to be the only thing thats down in this manic market. Inflation is a massively regressive tax.
4. Profit margins will fall during inflationary periods. Early in an inflation pricing power runs ahead of sticky wages/ supply contracts, but inflation always has the last laugh.
How does fiscal policy factor in? Seems like we will have looser fiscal policy which will force central banks to stay tighter?
totally agree