The psychic scars from October 13, 2022 (the Rolo Bottom, as I call it) will never fully heal. For a full six months now, the entire market has been lifted on a brief and simple notion: inflation is weakening, thus the Fed will pivot, and thus the market will roar to new lifetime highs just like the good old days.

Before we get to that, here is inflation going back for over a century The last deflationary period was a century ago, and ever since then, the government has vomited up cash with abandon, crushing buying power without interruption.

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Looking closer, you can see how the insidious effects of inflation went into overdrive with the Covid hysteria, allowing crooks to default the government out of hundreds of billions of dollars with a few simple clicks of the mouse.

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So the “good news” of inflation dying off is almost certainly going to transpire, but it’s also kind of preposterous. It would be like if you started off with a million dollars, and you only have one dollar left. Then someone shows up and gives you one dollar. You can celebrate your 100% gain in assets, but it still sucks the big one. Your good news doesn’t mean a thing. It’s all relative.

So here we see the forecast for month-over-month CPI to be at 0.3%:

The core CPI m/m is at 0.4% forecast:

And the headline rate, year over year, softening from 6% to 5.3%.

This delusion that “dis-inflation” is going to make everyone rich is absolute madness. The bullish mouthpiece Zerohedge has been promoting this notion particularly heavily. I wish I knew when this psychosis was going to wear off, but eventually, history will prove that, just like every single time before, the bear market really kicks into gear right when the Fed “pivots“, since it’s basically too late to help the economy anymore.

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