Views on inflation
Your interview on the investors podcast is really excellent and informative. Thanks for sharing your knowledge.
I am curious about your changing view on inflation. You seem to be much more concerned about inflation coming out of this than you were coming out of the 08 crisis. Can you expand on this thinking in a post? Thanks!
I am happy to write about this in more detail at some point when I find some time.
My general view is that the risk if rising inflation is higher coming out of this crisis for rather basic reasons - supply chains have been crushed, productivity has been reduced and yet balance sheets have expanded substantially. You have more assets chasing fewer goods and you even have a sustained rise in spending from those who are unemployed. My modeling predicts a chance of 3-4% CPI in 2022 & 2023. That’s not my base case, but it is is a much higher risk than it was coming out of 2008 when deflation was the obvious dominating factor.
As a follow up - I heard you say on a recent podcast that you'd be interested in owning "real assets". Have you altered your view on gold specifically?