RISING INFLATION YET RISING REAL RATES????

We clearly have mounting inflation pressures yet we are also seeing rising real rates. How exactly does that work?? To understand how this could happen is to understand what lies ahead!

  1. First, Real Rates are beginning to rise as a consequence of the Chinese Credit Impulse correlation. We have addressed this in prior newsletters and videos.
  2. Secondly, Inflation is rising due to:
  • A historic increase in Global Money Supply,
  • Marginally increasing Money Velocity because of both a liquidity driven economic recovery and consumer spending due to stimulus and the forbearance of consumer shelter costs.