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Post by Deleted on May 26, 2022 0:33:51 GMT
www.kiplinger.com/investing/stocks/604695/buy-value-stocks-says-jp-morgans-david-kellyThis is a nice piece. I think so anyways as it is pretty much how I see things. It also agrees with Siegel's view in many areas. GDP will grow, but more slowly, earnings are good, inflation will moderate more over the next 2 years, valuation matters, and international is cheap. But - this also recommends starting to look at bonds - my guess is because he sees inflation moderating more rapidly. Siegel's last interview with CNBC - money supply dropped by largest percentage in 60 years and he was shocked by the stat. Fed needs to watch money supply as it drains liquidity. Money already in the system still is inflationary and needs to work its way through system. Waiting to hear Siegel's projections with this large decrease in money supply. Edit - Money supply stats - it did go down! www.federalreserve.gov/releases/h6/current/default.htm
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Post by uncleharley on May 31, 2022 13:07:11 GMT
I would like to see the rate of inflation moderate, but i am not going to lead the cheering just yet. Europes move on oil is driving the price of crude up as I type. WTIC has broken above it recent trading range and set a recent high this morning. We shall see where it ultimately goes in good time.
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Post by Chahta on Jun 11, 2022 5:20:02 GMT
Not sure if we have a thread on this? Here is a very interesting conversation between Siegel and Bullard (St. Louis Fed). It is 50 minutes long and really interesting for those who like macroeconomic discussions: shows.acast.com/wharton-behind-the-markets/episodes/behind-the-markets-podcast-special-st-louis-fed-president-jiTakeaway for me - if consumer expectations for inflation don't fall in line, standby for a higher rate by year end than the market expects. Is the M2 impact a one time shock? Still growing double digits. Will expectations play a part to control inflationary increases? This seemed to be a key input for Bullard. How do you get new current episodes? I can’t seem to get past 5/20 episode. Thanks.
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Post by Deleted on Jun 11, 2022 11:17:28 GMT
That is the site. There probably isn't a new one or is late updating.
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Post by Deleted on Jun 15, 2022 10:11:24 GMT
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Inflation
Jun 15, 2022 11:33:02 GMT
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Post by Deleted on Jun 15, 2022 11:33:02 GMT
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Post by win1177 on Jun 15, 2022 13:03:14 GMT
Unfortunately it’s behind a paywall. Win
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Post by fishingrod on Jun 15, 2022 13:06:42 GMT
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Post by Deleted on Jun 15, 2022 14:31:11 GMT
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Post by win1177 on Jun 15, 2022 15:16:16 GMT
I found it on another site, thanks Sara!
I agree with what Chair Bernanke is saying, this is probably a “different” situation than past inflation scenarios. We have had a once in a lifetime global pandemic, followed by unprecedented govt. spending/ monetary support (maybe TOO much?), a war in Ukraine, supply chain disruptions, oil and gas “crash” followed by a HUGE surge in demand and prices, etc.
But the Fed has tools to slowly turn this situation around, but it will take some time/ patience. The markets have “corrected” down to a more appropriate price levels, based on P/E, as well as other valuation levels. They are not “screaming buys”, but also NOT outrageously overvalued. We will probably just have to tolerate some “pain” going forward. IMHO, this is like “turning an ocean liner”, it is a LONG, GRADUAL process in which you make adjustments miles in advance of where you are going, and recognize that it takes a long time to change your forward momentum.
Win
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Post by Deleted on Jun 28, 2022 22:09:11 GMT
Latest from Siegel - real inflation has been a lot higher than the CPI. Looking at money supply levels - the decline last month is very unusual and indicates Fed is tightening too quick. Thinks Fed needs to acknowledge they started slowing at the latest time in history during an inflationary period. Hopes they recognize that the bad inflation prints are looking at the past. Need to accept that and look at money supply as input to decisions. Thinks they are slamming on the brakes and need to consider not being so aggressive.
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Post by Mustang on Jun 28, 2022 23:42:15 GMT
I agree with what Chair Bernanke is saying, this is probably a “different” situation than past inflation scenarios. We have had a once in a lifetime global pandemic, followed by unprecedented govt. spending/ monetary support (maybe TOO much?), a war in Ukraine, supply chain disruptions, oil and gas “crash” followed by a HUGE surge in demand and prices, etc. Nothing repeats itself exactly but this sounds very familiar. How is thst different from unprecedented government spending/monetary support for Johnson's great society, war in Vietnam and an oil embargo?
Inflation is always caused by a HUGE surge in demand (from government stimulus money) and a shortage of supply which drives up prices.
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Post by Deleted on Jun 29, 2022 0:10:10 GMT
Well, Lyndon gave us Medicare & Medicaid, and me personally a masters and doctoral fellowships at two universities. No world wide pandemic, and people actually worked for a living then.
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Inflation
Jun 29, 2022 1:55:49 GMT
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Post by Norbert on Jun 29, 2022 1:55:49 GMT
I agree with what Chair Bernanke is saying, this is probably a “different” situation than past inflation scenarios. We have had a once in a lifetime global pandemic, followed by unprecedented govt. spending/ monetary support (maybe TOO much?), a war in Ukraine, supply chain disruptions, oil and gas “crash” followed by a HUGE surge in demand and prices, etc. Nothing repeats itself exactly but this sounds very familiar. How is thst different from unprecedented government spending/monetary support for Johnson's great society, war in Vietnam and an oil embargo?
Inflation is always caused by a HUGE surge in demand (from government stimulus money) and a shortage of supply which drives up prices.
Inflation is clearly not just a monetary phenomenon. It's also driven by fiscal policy and decisions that affect commodities prices.
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Post by Deleted on Jun 29, 2022 2:53:18 GMT
Norbert- I disagree. I fully believe it is primarily a monetary phenomenon. Fiscal spending has little relevant impact. However, I think this has already been well debated here. This time period will be an excellent case study for primary drivers of inflation.
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Post by FD1000 on Jun 29, 2022 4:01:02 GMT
Reading this thread reminds me of my university, it's all academic. With this in mind, I think we should start new threads about the following: scarcity, supply and demand, costs and benefits, and incentives.
I came to the conclusion pretty early to disregard economic theory and concentrate on accounting, statistics, finance. They are all based on accuracy/math and less on art.
What I "love" about economists is the fact they know how to BS but don't have a clue how to make money. I don't need explanation, I need to know when and what to do.
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Post by bizman on Jun 29, 2022 5:49:55 GMT
Nothing repeats itself exactly but this sounds very familiar. How is thst different from unprecedented government spending/monetary support for Johnson's great society, war in Vietnam and an oil embargo?
Inflation is always caused by a HUGE surge in demand (from government stimulus money) and a shortage of supply which drives up prices.
Inflation is clearly not just a monetary phenomenon. It's also driven by fiscal policy and decisions that affect commodities prices. I agree with Norbert here. Massive increases to demand without slack in supply has to go right to prices. It's the principle of the supply/demand curves in microeconomics aggregated. I believe this shows the flaw in Keynesians' focus only on goosing demand. The supply side matters too. This also should put the final nail in the coffin of MMT.
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Post by Deleted on Jun 29, 2022 7:58:39 GMT
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Inflation
Jun 29, 2022 12:32:03 GMT
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Post by Norbert on Jun 29, 2022 12:32:03 GMT
Norbert- I disagree. I fully believe it is primarily a monetary phenomenon. Fiscal spending has little relevant impact. However, I think this has already been well debated here. This time period will be an excellent case study for primary drivers of inflation. Here's a long-term chart comparing M2 growth and inflation: www.longtermtrends.net/m2-money-supply-vs-inflation/There's only a rough correlation; obviously other factors must be at work. We can see that money supply has been high for the past 2-3 decades, with little inflationary impact. Then suddenly, post Covid fiscal stimulus, with surging demand hitting supply chain issues, we now have high inflation. I rest my case. Of course, traditional inflation measures don't account for asset price inflation, of which there's been plenty in recent decades: stocks, real estate, and bonds have gone bananas. This has had a huge effect on our society, but I digress. What might be more interesting and relevant to debate is whether inflation will be persistent or not. If it's persistent, I think the Fed should risk a recession, which used to be a normal occurrence every so often. Not a bad thing, actually. N.
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Inflation
Jun 29, 2022 12:41:03 GMT
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Post by Chahta on Jun 29, 2022 12:41:03 GMT
I can easily see this round of inflation as the first wave. There is a dangerous group in Congress that wants unlimited spending. It could get worse down the road.
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Post by Deleted on Jun 29, 2022 13:09:56 GMT
Norbert - One immediate flaw in your extrapolations from the chart is that there is a simultaneous correspondence with money supply and inflation. This is not the case. The large spike we have witnessed will be spread out over a number of years of inflation. I.e. the 30%+ growth will result in a similar rise in the price index over a number of years. Also - saying that money supply growth is the primary driver of inflation doesn't mean all growth of the money supply results in inflation. It has to make it into the consumers' hands. This did not occur after the Great Recession when banks held on to it.
There are a lot of studies on this. This period should help move the body of knowledge along. The monetarists called this right. We can argue til the cows come home - plenty who think spending is the culprit - makes wonderful political press. I agree to disagree.
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Post by mozart522 on Jun 29, 2022 13:10:09 GMT
Latest from Siegel - real inflation has been a lot higher than the CPI. Looking at money supply levels - the decline last month is very unusual and indicates Fed is tightening too quick. Thinks Fed needs to acknowledge they started slowing at the latest time in history during an inflationary period. Hopes they recognize that the bad inflation prints are looking at the past. Need to accept that and look at money supply as input to decisions. Thinks they are slamming on the brakes and need to consider not being so aggressive. The day before the last increase he was on CNBC saying the FED should raise 1% the next day and stay aggressive. Just sayin' fortune.com/2022/06/15/jeremy-siegel-fed-interest-rates-100-bps-inflation/
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Post by mozart522 on Jun 29, 2022 13:11:25 GMT
I can easily see this round of inflation as the first wave. There is a dangerous group in Congress that wants unlimited spending. It could get worse down the road. No politics, bruh.
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Post by alvinthechipmunk on Jun 29, 2022 13:15:15 GMT
I can easily see this round of inflation as the first wave. There is a dangerous group in Congress that wants unlimited spending. It could get worse down the road. No politics, bruh. Wouldn't a TRULY progressive tax code bring the federal debt down to a reasonable, rational level? ORK?
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Post by mozart522 on Jun 29, 2022 13:20:58 GMT
Wouldn't a TRULY progressive tax code bring the federal debt down to a reasonable, rational level? ORK? Or a simple balanced budget like every single State in the union has. Our debt in 2021 reached 137% of our GDP.
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Post by bugman on Jun 29, 2022 13:28:13 GMT
Less fiscal spending, I can agree on but we need to increase revenue as well, since the corporate tax rate has done as much harm to the debt level.
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Post by Norbert on Jun 29, 2022 13:30:01 GMT
Norbert - One immediate flaw in your extrapolations from the chart is that there is a simultaneous correspondence with money supply and inflation. This is not the case. The large spike we have witnessed will be spread out over a number of years of inflation. I.e. the 30%+ growth will result in a similar rise in the price index over a number of years. Also - saying that money supply growth is the primary driver of inflation doesn't mean all growth of the money supply results in inflation. It has to make it into the consumers' hands. This did not occur after the Great Recession when banks held on to it. There are a lot of studies on this. This period should help move the body of knowledge along. The monetarists called this right. We can argue til the cows come home - plenty who think spending is the culprit - makes wonderful political press. I agree to disagree. I agree that monetary policy is the major driver, just not the only driver. Again, it's a slightly boring debate. Will inflation be persistent, that's what should matter to investors (at least those who think that "market timing" isn't a bad thing). If I knew that core inflation would be trending down, I'd be buying these dips.
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Post by Deleted on Jun 29, 2022 13:33:15 GMT
Latest from Siegel - real inflation has been a lot higher than the CPI. Looking at money supply levels - the decline last month is very unusual and indicates Fed is tightening too quick. Thinks Fed needs to acknowledge they started slowing at the latest time in history during an inflationary period. Hopes they recognize that the bad inflation prints are looking at the past. Need to accept that and look at money supply as input to decisions. Thinks they are slamming on the brakes and need to consider not being so aggressive. The day before the last increase he was on CNBC saying the FED should raise 1% the next day and stay aggressive. Just sayin' fortune.com/2022/06/15/jeremy-siegel-fed-interest-rates-100-bps-inflation/Yes- he suggested moving up the July rate hike and combining them to send the message they were serious about getting the genie back in the bottle. He has repeatedly said for months, they need to be careful and not slam on the brakes. Does this sound like be aggressive at all costs? No. I've been through the sound bytes to refute Siegel for a long time now. If you choose to look for perceived inconsistencies, I am sure you can find them. I think he has been very consistent, very correct, and continues to watch data - mainly M2 - on a weekly basis. Feel free to disregard. Just sayin'
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Post by Deleted on Jun 29, 2022 13:35:00 GMT
Norbert - One immediate flaw in your extrapolations from the chart is that there is a simultaneous correspondence with money supply and inflation. This is not the case. The large spike we have witnessed will be spread out over a number of years of inflation. I.e. the 30%+ growth will result in a similar rise in the price index over a number of years. Also - saying that money supply growth is the primary driver of inflation doesn't mean all growth of the money supply results in inflation. It has to make it into the consumers' hands. This did not occur after the Great Recession when banks held on to it. There are a lot of studies on this. This period should help move the body of knowledge along. The monetarists called this right. We can argue til the cows come home - plenty who think spending is the culprit - makes wonderful political press. I agree to disagree. I agree that monetary policy is the major driver, just not the only driver. Again, it's a slightly boring debate. Will inflation be persistent, that's what should matter to investors (at least those who think that "market timing" isn't a bad thing). If I knew that core inflation would be trending down, I'd be buying these dips. Will have to check - but seems to me I have heard rate of increase is trending down, but the prints coming are backward looking and will remain high.
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Post by johntaylor on Jun 29, 2022 13:44:51 GMT
Even in WW II, didn't debt to GDP peak at about 110%?
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