Rates May Go Much Higher for Much Longer | Page 3 | GIC discussions | Discussion forum

@Norman
No one knows how much of the inflation is a direct result of the Ukraine situation.
Same as when CB (and you were in the same camp if I am not mistaken) believed inflation sb transitory 9 months ago. Even if Putin completely withdraw tomorrow, it will take at least a couple of years for the rest of world to resume business with Russia. In other words, CB will need to treat that effect as a real inflation and deal with it via interest rate hike. Looks like we differ on that view point. Will see whos right at the end. No one has the perfect crystal ball and thats what makes things interesting.

Agree with you debt is nothing new nor bad. A smart use of debt is the fundamental building block of a modern economy. Its just individual who use equities in their home as a ATM the real issue.

Norman1 said
You're the one that actually needs help if you can't see how misguided it is to use interest rates to tame inflation caused by the boycott of Russian oil, Russian gas, Russian wheat, and other Russian exports.

This is exactly what Elvira Sakhipzadovna Nabiullina, Chairwoman of the Bank of Russia, is doing to tame inflation in Russia, which is caused by the economic boycott of Russia.

Alexandre, fundamental difference is Russians can't throw Putin out. Here a hint of austerity of any kind and folks rush to vote for other parties that promise no pain, in fact here's even more free stuff (yes, I believe CBs are subject to political interference). So democracies are hamstrung in a way they aren't in dictatorships, i.e. the "masses", as directed by media, run the show here.

agit said
Billionaire hedge fund manager Bill Ackman said raging inflation will only dissipate if the Federal Reserve acts more aggressively or the market sell-off turns into a full-on collapse.

“There is no prospect for a material reduction in inflation unless the Fed aggressively raises rates, or the stock market crashes, catalyzing an economic collapse and demand destruction,” Ackman said in a slew of tweets Tuesday.

https://www.cnbc.com/2022/05/24/bill-ackman-says-a-more-aggressive-fed-or-market-collapse-are-the-only-ways-to-stop-this-inflation.html  

Well what Ackman said is as obvious as saying "Sun will rise from the East tmrw mrng"...
As I already said and made up my mind, it will be period of stagflation follow by recession. Then inflation will fall back to new normal, which still wont be 2% a year.
The question really is how to one position one's portfolio to minimize the damage...

All these experts “ackman “ they position themselves first then start sharing all their widely respected opinions hoping to direct actions in a way they profit from… all these bankers care about numero uno and couldnt give two craps about anyone

savemoresaveoften said
The Russian way of dealing with inflation / economy fluctuation is similar to how Chinese central bank's mentality. You can not run/dictate the economy the way those 2 countries can.  

I thought BoC as well as Fed is independent entity. OK, that was a sarcasm.

I learned a lot on this forum and wish Putin would have listened to people saying the following:

Printing money does not trigger inflation

It would be misguided to use interest rates to tame inflation

Not having government debt is bad for the country and economy

Budget will balance itself

TommyT said
Rents are 32 percent of the CPI in America and are now just starting to work their way into the CPI index. They'll be fully factored in around March 2024. This is assuming they don't redefine it.  

I have seen a number of references suggesting that US CPI/Inflation stats are constantly/routinely manipulated so as to manage the factors that drive US social benefits indexation.