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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (183691)	2/9/2022 8:42:16 AM
From: carranza2	Read Replies (1) \| Respond to of 218068

Hoisington: hoisington.com “Even though unemployment fell in 2021, consumers became more alarmed by the drop in real wages according to surveys. The faster inflation shredded the budgets of about 75% of our households. In November, the level of real per capita disposable income equaled the year ago level which was also the lowest level since March of 2020. Consistently, The University of Michigan indicates consumer sentiment in the fourth quarter was worse than during the height of the 2020 pandemic and at the levels of the beginning of the very deep 2008-09 recession. Consumers cut back significantly on their buying plans as expectations for increases in future income slumped. To fund the sharply higher cost of necessities, households have been forced to reduce the personal saving rate in November to 6.9%, or 0.4% less than in December 2019. Needing to tap credit card lines undoubtedly contributed to the erosion in consumer confidence measures. Without the sizable cut in personal saving, real consumer expenditures were barely positive in the fourth quarter. With money growth likely to slow even more sharply in response to tapering by the FOMC, the velocity of money in a major downward trend, coupled with increased global over-indebtedness, poor demographics and other headwinds at work, the faster observed inflation of last year should unwind noticeably in 2022. Due to poor economic conditions in major overseas economies, 10- and 30-year government bond yields in Japan, Germany, France, and many other European countries are much lower than in the United States. Foreign investors will continue to be attracted to long-term U.S. Treasury bond yields. Investment in Treasury bonds should also have further appeal to domestic investors, as economic growth disappoints and inflation recedes in 2022.“ Makes sense. Bond yields, though rising, are still negative in the real sense thanks to inflation. In fact, real rates are surely significantly more negative than ever. So, things are likely to pretty much stay the same. That is, until the monstrous debt burden hits nations, corporations, and individuals. In other words, the lit match is getting closer to the fuse.