In this article I focus on two reasons why inflation will rise leading to higher, not lower, interest rates and bond yields. The first is the destruction of credit’s value through its non-productive expansion, mainly by governments running budget deficits. The second has had almost no attention but is at least as serious: the consequences of the repatriation of supply chains being accelerated by trade tariffs and sanctions. I shall briefly comment on the first before turning my attention to the second.
Think inflation is done? Think again!
A lethal combination of budget deficits and trade sanctions are going to be reflected in increasing price inflation for the US. And where the US goes, the rest of us follow.
