The new sexy bet in financial market is on inflation, but I don't get it.
Neither will we.
The bond market vigilantes are back. They will send rates spiking if inflation rises and that will stop growth cold. I'm not arguing that infation can't start, but it certainly can't flourish. It's a new world.
Bettors on inflation need to to explain to me how the rate of change in prices can sneak past the bond market. I don't think it can be done. Markets are vigilent. Inflation is not just about the Fed.
To get inflation you need more than just the Fed making mistakes and that is an important new ingredient.
Inflation: you can't get there from here.
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