Despite what the Fed is telling us, inflation is everywhere

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dan_s
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Joined: Fri Apr 23, 2010 8:22 am

Despite what the Fed is telling us, inflation is everywhere

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Conclusion of an opinion piece from Mark Rossano Founder and CEO of C6 Capital Holdings.

"At the peak of COVID lockdowns, we briefly saw some deflation, but now the proof is everywhere: inflation is kicking back up with a vengeance. But we face a bigger correction coming in the markets. Tough comps with refined product prices rising, failed political and economic policies, a rise in poverty and falling food security—it’s easy to sit here and say we are in a bubble, but when or how does it end? In the past year, the U.S. saw the most people added below the poverty line since the 60s, and 43 million Americans are currently on food stamps. A lack of food, economic expansion, and social mobility around the world is creating a powder keg of geopolitical uncertainty that is playing out everywhere: especially in Asia. This next decade is going to be a weird amalgamation of the 30s and 70s, consisting of inflation, deflation, and borderline hyperinflation. The Fed has destroyed price discovery and has attempted to hold back the “invisible hand” with endless liquidity, or “market support” as they describe it. But market forces are greater than any one entity, and the spring-loaded hand will come around to slap us all."

Only 50% of the people who have lost their jobs thanks to the pandemic will get those jobs back. The other 50% will be forced to take much lower paying jobs, turn to crime or commit suicide.

"The world is facing a growing shortfall in food as nationalism rises within countries looking to protect their own citizens first. We have seen several Biblical sized locust swarms, swine flu, avian flu, droughts, floods, and other acts of God that will cause you to ask the question: Do the four horsemen ride? The world has more and more mouths to feed, and we face a food crunch that will take more than one growing cycle to replenish. This assumes that EVERYTHING goes perfectly. So far, it isn’t. Brazil has been slow to harvest and plant new crops, Thailand is facing severe weather that is impacting rice, and Russia is raising taxes over concerns in the wheat harvest—just to name a few issues. This has pushed the UN Food and Agriculture World Food Price Index to multi-year highs, and given the current backdrop, the price rise is far from over."
Dan Steffens
Energy Prospectus Group
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