Insights

In Part 9 of our Cost of Capital series on inflation, we discuss how administration policy failures drove the US into this inflationary environment. We then posit whether the Fed has the willingness to aggressively fight inflation in the face of a potential economic slowdown.

In parts 1-7 of our Cost of Capital series, we discussed our views on inflation and how it would lead to higher interest rates and associated declines in asset prices. Now that this prediction has become reality, we move our discussion to charting a path forward. In Part 8, we highlight the risks and potential outcomes of a Fed tightening cycle pushing the economy into a recession or stagflation period.

In part 7 of our series on the Cost of Capital, we discuss the inflation-related data points market participants need to follow as the US economy enters what is uncharted territory for all but the most seasoned investors. We also highlight certain geopolitical events that could have an impact on inflation and interest rates domestically.

In Part 6 of the Cost of Capital series, we discuss one of the main drivers behind current (and likely future) elevated inflation levels: the cost of labor.

In Part 5 of the Cost of Capital series, we posit that the days of Quantitative Easing and easy money are coming to an end and that the US has reached a turning point on inflation and interest rates. We believe this development will pressure equity valuations and drive widening credit spreads.