Source here: https://www.usinflationcalculator.com/inflation/current-inflation-rates/
Inflation was at 8.5% in March. It's almost half a year later and it's still at 8.5%. It's moving in the right direction but we have to remember: When we look at annual inflation, adding a month on one end and chopping a month from the beginning still leaves eleven months in the middle. If the Fed can lower inflation at the same pace at which it skyrocketed we're in for a full year of pain starting today.
This is what it means when you think about investing for the “long term”. If you invested $1000 in the S&P at its peak in 2001, it would take 13 years to break even. If you invested the money halfway down, it would take 10 years to break even. And right now, valuations remain sky high.
So I'm not an oracle, but IDK how the fuck people think they can fight the fed for the next year. You gotta really beat the market just to do better than holding cash. Equities are going to tank – this is deterministic – because the Fed is determined to destroy them, no?
Here's the thing: Even if the strongest growth companies priced at ridiculous valuations keep pace, that doesn't mean the market cap has to grow with them. These companies can keep growing while the share price shrinks to smaller multiples. This is what happened in the 70s: the airline industry took off, but investors lost heaps of cash trying to ride the wave.
What planet are the bulls living on right now? Cramer's basement?
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