Taps Coogan – September 3rd, 2022
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Dr. Ed Yardeni, creator of the highly informative website Yardeni Research and author of ‘In Praise of Profits,’ recently spoke with Bloomberg about his outlook for inflation and markets.
Some excerpts from Ed Yardeni:
“This (period) is really I think is going to turn out to be more like after the soldiers came back from World War II (than the 1970s) and we had this huge demand for consumer durable goods and Ford was making bombers not cars and it took them a couple of years to retool… We really also have an energy component to it and I think that could soon moderate… I think this is not going to be like the great inflation of the 1970s. I think we have seen the peak. I think it is going to moderate and I think we can all hopefully look forward to that.”
“I’ve been thinking for a while that there is just no way that they are going to get inflation down to 3% anytime soon, which means I don’t think it’s going to happen this year… next year…, and maybe even not the year after that. The problem is rent inflation as we all know and rent inflation is sticky… I think they are going to have to change their tune and conclude that 3% is the inflation target they want to reach…”
I can’t help but roughly agree with Dr. Yardeni on the inflation outlook. Most leading indicators are showing that inflation has peaked on a year-over-year basis and core inflation has been trending lower for five months. I also agree that it is hard to figure out how inflation gets below 3% anytime soon.
What I don’t get is why he thinks an environment where inflation is above target for years would be something to look forward too. Monetary policy is going to be a headwind for the economy and markets until inflation gets back to 2%. That’s unlikely to happen on this side of a recession (one that’s likely barely started). That’s not necessarily apocalyptic but it’s certain not going to be pleasant.
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I don’t think inflation has peaked. We’ll see
“Inflation Will Moderate” ― Ed Yardeni Ed speculates on nonsense, while the cult of tyranny advances their singularity — while the corrupt central bank cartels, via their affiliates, outbid you and buy up literally EVERYTHING by CREATING the digits for which your government forces you to WORK. Look no further than the historical growth rates in total holdings of: (1) the entities that have been employing ex-central bankers, (2) the entities that receive preferential rates from central banks, (3) the primary dealers and (4) the shareholders of the central banks. Consider that no one has ever been investigated, much less… Read more »