Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.
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What could get bond yields to not only go there… but higher and higher from there? A) What’s been driving them higher since November! (US Growth & Inflation Accelerating at the same time)… and If you’d like a more eloquent non-Fed & Old Wall explanation of why on #InflationAccelerating, big time, from here… here’s an excerpt from one of my long-time teammates’ (Christian Drake) notes on inflation yesterday: "In short, this remains one of the slowest moving, most proactively predictable reflationary trains in memory. February was the last base effect stop before trough Covid Comps begin flowing through the reported price data … and note that, as it stands, trough comps, the vaccination/reopening procession, the prospective acceleration in hiring/organic consumption capacity and the prospective deployment of accumulated excess household savings are all converging on roughly the same timeline … carrying the potential for a combustible inflationary cocktail and a (transient) wonderland for reflation-philes.” |
