Inflation is reaching a boiling point and markets are too relaxed

Bloomberg/Mark Cudmore/11-10-2021

Ramirez cartoon of Treas Sec sitting in a pot of boiling water while an alarmed frog leaps out

Cartoon courtesy of MichaelPRamirez.com

“And yet markets don’t really seem to care too much. Sure, U.S. yields and the dollar both surged, while stocks tumbled. But there’s no panic about the enormity of what we’re seeing.”

USAGOLD note: Cudmore focuses on the repercussions of runaway inflation being signaled on a global basis saying that barely anyone bothered commenting on Japan’s wholesale inflation rate coming in a 8% last week. (We did in Thursday’s Daily Market Report). China, by the way, reported its October producer price index up 13.5% year over year. He says “the metaphor of frogs in a pot of water has never been a more apt analogy” and that “the year ahead will see immense asset-price dislocations.” Meanwhile, the Treasury Secretary, the President, and the chairman of the Federal Reserve do not seem at all worried about the frog in boiling water analogy. Cudmore is a macro-strategist at Bloomberg.

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