04Jan9:18 amEST

The Biggest Pushback I am Getting

Occasionally, I offer opinions and macro views both here and on Twitter, alongside the private feed for Members

Recently, on my main Twitter account (@chessNwine) by far the biggest pushback I am getting from folks is in regards to both the possibility of higher oil/gas prices and higher rates this year. 

Clearly, I am in the camp that we will see both. But many are not. Mind you, I have no issue whosoever with respectful disagreement.

The larger point, however, is that recency bias seems to be affecting many who simply will not allow for much higher rates and much higher gas/oil prices even though inflation is still very much a threat, to the point where even The Fed has been forced to pivot. 

Every day on financial news television there is another pundit who exhorts how imminent the collapse of exorbitant used car prices is, but what if that does not happen so quickly? Consider all those working class folks who need to a car to get to work. What if they, God forbid, have an accident or have their car stolen and do not have enough liquidity or credit to buy a used one in this climate? 

Instead, The Fed seems much more worried about "not rattling" a market which made over 70 new all-time highs on the S&P in 2021. 

Simply put, inflation is still here even in the coldness of winter during the latest phase of the pandemic. Try to imagine, come springtime for example, if the pandemic abates just how hot prices will become then--At the pump, the grocery store, etc.. 

The risk is higher, both with rates and gas prices. 

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