- US equities have not been having a bad time recently, but have certainly been struggling to go higher.
- China's slowdown, Evergrande contagion worries, supply chain disruptions, energy price surges, an appreciating dollar, rising Treasury yields, US debt ceiling anxiety, lingering Covid issues, North Korea firing missiles - it doesn't really feel like an optimal backdrop as we head into the fourth quarter.
- While the world seems to be getting more concerned about the idea of "stagflation", it’s hard to fully sign up to the stagflation argument when the split between temporary price-level adjustment and entrenched higher price and wage-setting behaviour remains unclear.
For further details see:
Stagflation, Sort Of