#INFLATION!!!! Well, maybe "Inflation". Here are three ways to look at it:
1. The long term core inflation posted a new high of 3.8%. Let's call it a 30 year high and not great for consumers.
2. On a year over year basis 5.0%. Also not great for consumers.
3. On a year over 2 year basis 2.56%, so maybe this isn't a disaster after all.
Which one do you think is the most important?
My own view is that much of the recent headline inflation is driven by comparisons to pandemic shutdown issues, supply chain shortfalls, and an exodus from the cities to suburbia. Underlying those issues is a continuous rate of baseline inflation that continues to drive up food, housing and wages. Additionally, don’t forget that regulatory and legislative actions on things like work rules, minimum wage, masks, social distancing and benefits (like Obamacare) have also significantly affect the level of costs. It is easy to blame the Fed, but the data on commercial lending growth indicates that the broad money supply is not expanding rapidly.
Robert Lloyds, CFA®
Chief Investment Officer
Lloyds Intrepid Wealth Management
Lloyds Intrepid LLC is doing business as Lloyds Intrepid Wealth Management. Lloyds Intrepid LLC offers investment advisory services in the State of Texas where registered and in other jurisdictions where exempted. Registration does not imply a certain level of skill or training. Lloyds Intrepid LLC and its advisers do not provide legal, tax or accounting advice. Lloyds Intrepid LLC formulates retirement plans, investment strategies, portfolio construction and investment due diligence for clients with signed investment advisory agreements with us. The information contained herein has been obtained from sources believed to be reliable, but the accuracy of the information cannot be guaranteed. All opinions and outlooks are subject to change.
© 2021 Lloyds Intrepid LLC