John Rubino, Founder of the Dollar Collapse website, joins us to discuss the market trends for 2022 in interest rates, bonds, GDP growth estimates, inflation, stagflation, market volatility, and gold.
We start by reviewing the move higher global in interest rates, as many central banks have started hiking rates, and there are less bonds being purchased, so the expectations for higher rates are in the markets. John outlines that there are some estimates for GDP growth to fall, and how with the higher inflation, that the Fed may actually be starting to hiking rates into a problematic backdrop of stagflation.
Next we ponder if the Fed has been trying to slow-walk the rate hike cycle long enough for some disinflation to set in, and take some of the pressure off. John feels inflation will still be high enough to keep real rates meaningfully negative for the foreseeable future. When one considers the planned Fed policies and the current macro backdrop, this will continue to create volatility and John believes more investors will gravitate towards real assets, including gold and silver, over the recent narrow focus on just financial assets.
We wrap up looking at the disappointing retail sales numbers from December, and how it may be indicative of consumers slowing down their spending. With the stimulus money spent, the sugar-high effect from the reopening trade waning, and increasing consumer debt loads this lack of demand may be another factor the takes some pressure off inflation, but it would be counterbalanced with slowing growth, creating a very uncertain path forward for the economy.