I'm going to make this brief...I don't think we have seen the end of high inflation!! I picked up a vegetable platter at Walmart today. The price has risen about 40% in the last year. Later today, I talked with a owner of the local cafe/coffee shop. I asked what has gone up the most...He said bacon/pork!! I'm thinking that is the cheapest meat out there. He said with California laws, it is becoming harder to produce/sell pork products in CA. I think he was talking about per box on the pork products. He said last year he was paying $40. per box...That same box is now $100. Just my thoughts...The end of inflation below 5% is NOT here.
I picked up some potato salad just now (local grocer, who is a bit high in their prices). $5.99 (six dollars) a pound... I try not to be that old man yelling at those kids to "get off my lawn"... For me (concerning inflation), I don't buy it...
The other kind of inflation is the good old government generated kind. City next to me just passed a 2% sales tax, and the county I am in just increased their sales tax. A few decades ago the County Board passed a huge sweet heart package that gave county employees the ability to take anywhere from $100,000's to a couple million in lump sum payouts at retirement in addition to their pensions. The payday started hitting a few years ago and will continue for awhile. The next County head after that shit bag, who never had to answer for it, but got his cut, ended the program going forward, but will be a drain for the near future, hence the tax levy increase.
The next shoe to fall will be state/county/city pensions. California had a "surplus" because of the pandemic for awhile. They gave out $1,000. checks to pretty much everyone (in October before an election). A few months later...Son of a gun, we are running a huge deficit!! Those employees are going to wind up with a haircut on their pension. No one talks about this...But watch and see.
My state is trying to figure out how to spend the Covid surplus from the Feds as fast as they can to avoid having to give it back. Our tax dollars at waste...er work.
As I forecast, a repeat of 2010-2013+ as traders refuse to believe inflation numbers because of things like food prices. Canada's inflation rate was 2.8% even though food was around 9%. Many traders have bad habits, they hang onto their theories far too long and look for any evidence they can to support their biases ( eg media, other day traders, their shopping trips ). So the idea that inflation was going to kill markets in 2023 ( and we would be in a deep recession right now ) took hold mid-2022. Now that those theories are clearly wrong, many traders are very slow to admit that and move forward. The lag effect is amazing even though a full year ago the math showed likely otherwise. In the fall, I said 2023 would be the year of "changing narratives". And that is certainly true, the very same analysts and media types on Bloomberg that were pumping the doomsday scenarios are now finally changing their tune. It got so bad last fall I just muted them and of course it was a great time to buy stocks nobody wanted.