Taps Coogan – December 7th, 2021

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Add the following chart, from Danske Bank Research, to the growing pile that explain why inflationary pressures are unlikely like to subside quite yet.

US consumers are still buying manufactured goods at a breakneck pace, well in excess of the pre-Covid trend as they continue to shift spending from services that they can’t buy because of Covid restrictions to goods that they can.

The dramatic increase in demand for goods has snarled supply chains and led to cascading shortages that endless rounds of stimulus have only exacerbated.

Who knows how long it will take for demand to normalize or supply chains to catch up? For now all we can say is that it hasn’t happened yet.

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