EC Why Inflation Isn’t Coming

According to BofA’s models, “for value to recover its losses this year, Treasury yields would have to rise from 0.7% to 1.8%, PMIs would have to remain in expansion territory, and breakevens would have to rise from 1.9% to 2.5%.”

  1. This week we’re watching for breakout confirmation of a US dollar retrace. USDSEK is one of our favorite setups for the swing trade. You can read up more on my dollar thesis here and here.

Stay safe out there and keep your head on a swivel.

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William K. 2 months ago Member's comment

The clear and obvious reason that there is not much return on cash and safe assets (#9) is that the FED has moved the interest rate on them to about zero. So while it is true, the explanation is simple and the guilty are obvious. So once again we see that the fed is taking care of its friends. Certainly protection CAN be purchased, at least the kind given here. And the inflation has not taken off just yet because some things take a while. But when lots of fuel is thrown onto a fire, eventually it will start to burn. The cause of inflation is known, the exact time it takes is variable. The dilution of the value of the assets is real, sometimes the damage takes a while to catch up.

What needs to happen is that the truth of who did what will be known and so the anger will be directed at the correct targets.