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Inflation modeling

Hi Cullen,

I've read here that the FED is described as just a big public clearing house, which basically chases inflation around having no real power to generate inflation; and it's questionable  that it has the power to meet the goals of its dual mandate. So it seems inflation can only be generated by our spending (Executive power) vs our national production (Corporations).

I also read that your modeling predicts 3-4% inflation by 2022. I will assume this only takes into account the current stimulus spending, and not any upcoming stimulus, if any.

Does your modeling use an assumed ratio of Debt/GDP or other factor that signals a predicted rise in inflation in the next xx months? Can we know what it is or what gauge you use?

I don't disclose the model inputs I use for things like this. Sorry.

hugo has reacted to this post.

Hi @cullen-roche

The 4% stock gains that are most likely in the following yrs, is that before or after inflation? In other words if you (must) cash out your stocks in those years and inflation is 4%, does that net out to a gain of 0% (4 - 4 =0)?