DesmondMilesDant OP t1_j9eqx4t wrote
Reply to comment by dolphinsgt61311 in Wall Street Newsletter S02E07 : Why is there such a disconnect b/w Stock and Bond market? by DesmondMilesDant
Thanks man. Sorry i don't know the guy. But ofc i know about this. I was the one who started invalidation cases saying "Disinflation trade of Stagflation" leads to ATH in no time. S&P5000 here we come and then a whooping -50% drop to $2500.🤣
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But there is a huge problem with this. Major component of CPI is housing which wont come down in 1H 2023. It's in the second half it can fall off the cliff if inflation isn't sticky. That means inflation can potentially stay here or start its mini uptrend in 1H 23. This will panic Fed and force them to go 5.5%. This is what i am trading. A 5.5% rates with 100bps Erp ( currently 15bps ) = PE 15-16. Current E = 225. This will mean testing of Oct lows.
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