Sep 12, 2022·edited Sep 12, 2022Liked by Callum Thomas

The market is masterful as to the uncertainty of the (any S, M,L ) coming moves, to how we understand and apply both technicals and fundamentals. So devious in that respect,. An A game is always required. Bonds could pay big, just not yet. (Own TYD FYI).

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Excellent post, thank you. Just one remark.

Graph 10 looks a bit “iffy”: in 2011, 2015 and 2019, the CB liquidity -14M lead and CPI moved in opposite directions, only the 2020 trough and the 2022 peak coincide. That feels like some just “fitted” a time shift to make the latest trough/peak coincide. Lots of recency bias in that.

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Yeah, valid question, a few things: firstly the relationship is economically logical (i.e. more stimulus = more tailwind to growth/demand/commodities/inflation, and less stimulus/tightening the opposite), second I have a bunch of leading indicators that point to lower growth, i.e. are consistent with that (in that lower growth should ~~ lead to lower inflation), and finally, I have a couple of inflation leading indicators which also agree in terms of the outlook (lower inflation into 2023). So regardless of that individual chart, I think the conclusion holds.....

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