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“Whenever you find yourself on the side of the majority, it is time to reform (or pause and reflect).”
― Mark Twain
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Kevin Warsh Saying Things People Want To Hear
"AI is going to make almost everything cost less. We’re at the front end of a productivity boom. Economic growth won’t be inflationary — we’re in the early innings of a structural decline in prices."
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If AI is deeply deflationary, and we’re only in the early innings of that deflationary impulse, why is the invisible hand signaling the opposite? Maybe because the early phase of a deflationary cycle is actually stagflationary.
The problem is, almost no one truly understands or remembers what stagflation feels like. We’ve talked about it extensively, but as long as the suits keep reassuring everyone that the opposite is coming, most won’t be prepared for a backdrop of rising inflation, weak economic activity, and increasing unemployment.
As we’ve said before, Kevin Warsh should be raising his hand to go to the bathroom — and closing the backdoor for good.
Stagflation, Inflation, and Deflation
Trump's negotiated Middle East peace plan that changes roughly every 30 seconds will reinforce the deflationary impulse argument that the gullible crowd will embrace because they've got nothing else to latch onto. Marginal inflationary pressures, unfortunately, are as strong as they were when the CPI was posting double-digit gains, and everyone was screaming bloody murder (see Marginal Inflation Rate).
Marginal Inflation Rate
The stagflationary impulse is nearly as bad as the previous one that crippled households and paused the stock market rally (see Stagflationary Trend). Are you ready? Please watch for updates to the Economy & Stock Report.
Stagflationary Trend
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The Matrix provides market-driven trend, cycles, and intermarket analysis.
