In a recent post, I lamented that rather than chasing macro trades, I should have just indexed. The problem with indexing, as far as I am concerned, was that inflation trade seem to imply indexing is a disaster trade waiting to happen. One very long dated chart that I liked looking at was the performance of the S&P 500 compared to returns from treasuries. Equities seem to have greatly outperformed treasuries, and I am bearish treasuries would imply a very bearish view on equities. The excess of the dot com bubble, saw the reverse excess of the GFC. Hubris before nemesis - as they say. If the dot com bubble was hubris - I am not sure what we would call today.
The problem for me, is that I think a “pro-labour” turn in politics is making the world inflationary - and I have been pushing, GLD/TLT, which has taken out new cycle highs.
Other inflation indicators I look at have inflected from deflation, back to inflation.
