Trend remains in tact....

21 feb 2022

The trend says, up and to the right. The price will bounce around, but as long as the Ukraine situation remains unsolved, I suspect the price just keeps grinding higher. Higher inflation remains tailwind (strong), offset by the headwind of IR hikes by the FED (weak). My view is the FED is behind the curve, and even if they hike, negative real yields continue. CPI just printed at 7.5% - an all time new high, and blowing thru the highest end of the forecast range. Interest rates are at 0%, and the market is calling for 4 to 8, 0.25 hikes in 2022. At 7.5% the CPI is at the same level it was in 1982, and the interest rate then was 11.25%. Commodities, real estate, energy, and precious metals will all do well in this environment. Meanwhile, we see the economy slowing in the US with GDP growth near 0% for the quarter, and some analysts calling for another low-growth (or no growth) quarter. And we see the rotation from growth (tech) to quality (income) stocks, etc.

22 feb 2022

Nota

The inflation and geopolitical decisions have already been made. The market needs time to digest and back-fill. The thesis continues to play out.