The Terrible Twos, 2022 — Outlook for the Year Ahead

2022, The Terrible Twos — Outlook for the Year Ahead

Credit: Photo and graphics by Michael Ashley
Source: Bloomberg
Source: Bloomberg

Note: If you or a corporation have excessive debt, you want inflation because it erodes the value of that debt.

Note: Inflation, especially high inflation, can make real rates negative. For example, if inflation is 3%, and Fed rates move up to 2%, then real interest rates are negative: -1%, because 2% — 3% = -1%. If real rates remain negative, the Fed should technically have room to raise rates yet keep monetary policy stimulative.

Source: Bloomberg
Credit: Photo and graphics by Michael Ashley

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