Stocks have erupted higher in the last month based on the belief that the economy is roaring once again. However, this is all about sentiment, not reality. The Fed’s own real-time GDP tracking tools has collapsed from predicting growth of 3.5% in early February to just 1.9% last week.
While “growth” isn’t coming anytime soon… INFLATION is.
Globally, inflation metrics are going through the roof. In the US, inflation is now well above the Fed’s target rate of 2%. If you were looking at this chart as if it were a stock, you’d say that was a seriously bullish breakout.
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