Inflation looming?

Here’s a person who thinks so, based on the data reflected in these two charts posted here and shown below:

Nominal vs Real Yields

TIPS valuation

I think the argument makes sense.  The question now is how high inflation will go, as withdrawing the monetary stimulus would put a drag on economic growth for the US.  There will be a lot of pressure on the FRB not to reverse its stimulative policies.

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2 Comments »

  1. […] dramatically. Industrial production is down, and spare capacity is up. Inflation is down. As is expected inflation (from TIPs yields), though not as much as in the fall. The Fed’s balance sheet is larger, and […]

  2. […] dramatically. Industrial production is down, and spare capacity is up. Inflation is down. As is expected inflation (from TIPs yields), though not as much as in the fall. The Fed’s balance sheet is larger, and […]

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