Chris and Doc at various times have suggested we may get a prolonged, somewhat monotonous period of stagflation unfolding; no major moves up or even down for stocks broadly, BUT an environment where a grinding, internal correction within markets is at work…and where commodities finally outperform financial assets again.
In this piece linked below –by Danielle DiMartino Booth, a former advisor to the Dallas Fed — she underscores how pricing pressures are bubbling up at a faster rate. Even during this otherwise positive earnings season, some companies are telling of margins getting squeezed more due to higher costs they pay. Among other things, this is going to compel investors to do their homework and focus on companies able to raise prices and benefit from stagflation…and shun companies which can’t, and whose profits are thus getting whittled down.