Inflation - not in most of 2023
Inflation – it’s been the 2022 word of the year. And finally, as we head into 2023, it’s starting to come down in a big way. We got a much cooler-than-expected Consumer Price Index (CPI) report on Tuesday. As a result, the market has been on a tear. And we think this rally is just a taste of what’s to come. It seems clear that inflation will crash back to 2% over the next 12 to 24 months. In fact, over the past 100 years of market history, we’ve had seven prior periods of red-hot inflation that became disinflation – just like what we’re seeing today. Each time, when inflation began to fall, it kept going lower. On average, we saw two to three years of disinflation and about 10 points off of the CPI. The current disinflation wave has begun, and it’s still early in this ballgame. The forces are in motion – and they’re going to stay that way for a long time. We’re confident that in 2023, disinflation will be the word of the year. And since stocks re...
