저자: Kevin · 외국인
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스태그플레이션성 경기침체 가능성을 제기하며, 2022년 미국 경기가 하반기에 역성장할 수 있다고 봄. 다만 3월이 인플레 정점일 가능성과 연준의 과도하지 않은 긴축 기대를 근거로 2023년 경기침체 우려는 완화될 것으로 봄. 시장 지표(5년 breakeven 하락, 코스트코·MP머티리얼즈 등 고점 후 하락, JOLTS 호조)를 언급하며 인플레 공포가 일부 해소되는 조짐이라고 설명.
다듬은 글
is it possible that we are going into a stagflationary recession and what does this have to do with potentially looking back at the 1970s well let's talk about exactly that so in the 1970s we had the arab oil embargo which created a prolonged period of inflation gas lines gas shortages gas rationing and massive inflation massive to the point where we had to get what's now called vulcard which is when paul volcker stepped in finally in the late 70s and early 80s and said enough of this we're raising rates aggressively to over 15 16 so we can crush inflation by getting ahead of inflation we are going to force a recession because when we raise rates so substantially we sap demand creating a year-over-year negative growth in gdp two quarters of that in a row boom you've got a recession so we crushed it uh essentially by raising rates to such ridiculous levels that borrowing essentially stopped and we were able to end inflation by proving that the federal reserve had the intention of fighting inflation see back in the 70s at the same time as we had the arab oil embargo we had a complete loss of confidence in just hadn't had to deal with this before and they were clueless in terms of how to deal with it the government was failing because the government had price sealing policies in place which just exacerbated shortages i mean think about it if prices are not allowed to go up then you get even more shortages and which eventually bottles up even more inflation and so when those price ceiling policies were removed in the 70s by nixon what did you end up having well you ended up having substantial inflation because the price ceiling is now gone and so prices were able to go to market prices which were now exacerbated by even worse shortages right and so inflation took hold via the uh arab oil embargo these lifting of failed government uh policies on price ceilings and the expectation that the federal reserve was not going to be able to tame inflation that was really bad and on top of that what did we do in the 70s well nixon in 1971 decided you know we're going to leave the gold standard which made everybody think that's it we're going back to the 1920s wymore republic where you're walking around with wheelbarrows of cash in because well like a loaf of bread costs a wheelbarrow of cash uh and so this this led to the expectation that inflation was just going to destroy the american dollar especially since it wasn't on the gold standard and either we'd go back in the gold standard or we're screwed now we ended up just getting vulgared which was also bad because it led to a pretty nasty recession but but it ended up solving inflation and and so this is how we ended up regaining fiat trust so to speak and inflation stabilized and so for 40 years thereafter inflation has been essentially on this downward trend that you know productivity is up uh you've got uh innovation up and and really expectations that over time as democracies mature you end up getting less inflation that's just statistically what happens and this is why uh more mature democracies like you have uh in europe are substantially uh or before this latest crisis have been facing substantially lower inflation than us even to the point of being in uh territory where uh rates are negative right this is not where the amer where america was before uh the pandemic and war and so that's where we now have this boom of inflation now and it is the largest commodity shock that we've really experienced since the 1970s and so it's scary because much like the shock of the arab oil embargo in the 70s we've got this dual effect now of a pandemic via covert 1.0 uh delta variant of covid omicron variant of covid and now war all leading to a similar style energy and commodity shock again the likes of which we haven't seen for 50 plus years and this could get even worse by the halting of natural gas flows from russia to germany and other countries who refuse to use the russian ruble to transact because this would require germany essentially have a bank in russia and uh send euros to that bank in russia uh convert to the russian ruble and then buy uh you know natural gas poland has so far refused to do this and has been cut off by russia and so you get a lot of these sort of fears that are building up and on top of that we now had the first quarter of negative gdp for the united states uh you know since the covet pandemic this was absolutely not expected nobody was forecasting uh this well at least in in terms of uh economist consensus estimates of uh growth of 1.4 you know us actually i think it's actually growth of 1.5 but actually having gdp of negative 1.4 we've got some real issues right on top of the fact that china is already likely in a recession but their their data is questionable so you know maybe they are intercession but we don't know about it uh south korea has had its highest levels of inflation in the last 10 years we don't even need to start talking about the inflation that we're seeing in brazil over 10 argentina even more than that europe's likely in a recession or going into a recession global growth is slowing and quite frankly we expect gdp this year uh to be four point one percent across the world or at least i should say we expected that in january and that's already been cut by like 25 down to 3.3 percent and quite frankly that's likely still too high we're probably going to have even lower global growth uh at the same time we started the year with global inflation expectations of around 2.25 for the world and we're going to be at like 6.2 percent that's at least where the estimates are now which are also probably wrong so this is where now there are serious concerns that we're going to be in a stagflationary environment potentially all of 2022 and so stagflation is really like the worst possible case that you could imagine because if you're on stagflation and you're maybe in a stagflation induced recession so we could call that stagflationary recession well now you've got really big problems because see the way you solve stagflation is by on one hand you have to deal with part one which is a stagnating economy well usually the way to solve a stagnating economy is you expect productivity to go up and spending to go up but uh the way to encourage that would be via stimulus or lower interest rates but the way if you do that you actually end up likely increasing the odds of inflation continuing and and anchoring and if inflation gets anchored because people are seeing wow the fed's still printing money wow the u.s government is you know still printing money well then what do you have well you end up and i just want to clarify that really quick so i don't get comments on it the united states government actually runs the money printers but the federal reserve can essentially finance that by creating numbers on a spreadsheet okay they call it digital printing the government actually prints it okay government stimulates via like stimulus checks uh the federal reserve stimulates by lowering rates or you know buying bonds uh which which then puts cash on bank balance sheets which they can then lend out okay clarify so anyway uh so the way you deal with inflation is by raising rates and again the way you deal with stagnation is by lowering rates so you're really at like like what what is the federal reserve supposed to do and remember consumers make up 70 of the economy so this means honestly 2022 and we've been saying this since january and i've had this consistent argument that 2022 could just straight up suck why because here's the thing q1 gdp was negative well what happens if q1 gdp being negative is enough to kind of create enough fear in at least some consumers that we pull back not like substantially but just to where we we're not positive year over year like if gdp just for simple purposes is 20 trillion dollars last year and then this year we pull back just one dollar just one dollar like you don't actually have to pull back that freaking much you just pull back one dollar now you're negative year over year right at 19.99 whatever so this means we could actually have a stagflationary recession to where now some folks are saying look we might be negative for q1 because we had omicron in january and people weren't spending in january people are spending more now which means maybe we'll have a positive q2 but if people get scared about what happened in q1 and then we get worse spending in q3 and 4 especially since q34 last year is when we had the child tax credit lots of spending like crazy black friday numbers right lots of consumer spending well then we could end up having a negative q1 negative q3 negative q4 and even though we technically didn't have a recession in the first half we would have a recession in the second half and you could just have a nasty 2022 which would probably set up for an easy beat in 2023 which means no recession in 2023 but still you're going to live through potentially this stagflationary recession of 2022 where the only way to get through this nonsense is basically just to suffer you're going to suffer the stock market volatility you suffer the real estate volatility because as the 10-year treasury is dancing around three percent mortgage rates people are now getting quoted i mean they're technically sitting around five five and a quarter but unless you're a perfect borrower you're probably paying like 5.58 right now for for a loan which is crazy i mean we're closer to six percent now than we are to five percent so in other words we could see that spending decline and end up having a stagflationary recession towards towards the end of the year now the only thing that could potentially make this better is potentially hitting peak inflation and us being at a a point where the federal reserve can u-turn and so this is the hopium that everybody has it's kind of like why my real estate and stocks is back to the moon because if it comes true that we do end up having peak inflation in march then the federal reserve can actually deal with stagflation they could say okay cool we don't actually have to raise rates as aggressively so we could keep like staying neutral or slightly kind of stimulate the markets to avoid or not markets the economy to uh to prevent stagflation while at the same time inflation is naturally coming down that would just be like best case scenario but it could be just like you know smoking opium so uh forecast right now actually kind of suggests that the hopium might be accurate uh and so that's what's also weird is first of all five year break evens which are the market's expectations for inflation have come down since their peak in march quite substantially the peak in march we were like 3.7 on the five-year break even now we're at uh 3.23 so that's a nice decline the uh forecast for inflation next month is 0.2 month over month that's an annualized run rate of inflation of just 2.4 percent that's really really good uh core inflation is expected to be 0.4 which is an annual run rate of about 4.8 percent that excludes food and gas which in order for you to have a higher core number than a higher overall number means that food and gas went negative which is entirely possible that food and gas went negative because uh in you know in april compared to march because in march everything just went to the freaking moon you know at the same time we have uh you know some signs that that consumers are relaxing a little bit uh you know with with their spending which is actually a good thing for example leading indicators of railcar freight activity are showing somewhat of a slowdown in consumer spending for crap for goods and services certainly durables used car prices going down washing machines refrigerators right these things relaxing however service spending is still crazy i mean you look at the travel sector and forecast for like expedia and forecast for for the airlines those are actually really good so consumers still spending but spending in places where we're not doubling up on those supply chain issues so potentially we end up with a peak in march right and so then when you kind of look at what the stock market is doing and this is in my opinion quite interesting it's sort of a little bit of a leading indicator that maybe the inflationary fear play is starting to unwind a little bit and remember i don't know if this is going to be a fact but i always like to tell you things when i see them happen uh earlier so so that way you can have a little bit of a of a heads up uh in terms of where a trend might be going so remember when we had inflationary concerns it was like okay get out of consumer discretionaries get into consumer staples and materials so what did everybody do everybody flocked to things like costco which is your like core consumer staple okay fine but what happened with costco well costco is now actually trending down it's down like what 12 percent now from its peak just about a week to two weeks ago another one mp materials was a lot you know it is still a mining company but it was seen as oh my gosh this is the perfect hedge for inflation it's been on this phenomenal uptrend but you've seen this peak right around the beginning of april and so it's kind of been on like a one month downtrend i mean so is the nasdaq right the nasdaq's also been on one month downtrend but you are seeing some potential capping on some of these same thing with the weed etf even though it's been consolidating on slightly a little upward trend it certainly hasn't been some of the peaks that we've seen now again it could be that this is correlating to the nasdaq or the spy going down but costco has been going up regularly during times in which the spy has been going down again you go back to costco it's really been just recent let's go to the day here instead of the week it's really only been since about the last week of april that you've seen this sort of peaking and u-turning here so this is something where some folks are saying hey the market kevin is already telling us that we're we've hit peak fear and commodities we've hit peak fear in inflation protections market expectations via the five-year break even are way down from uh you know down 60 basis points uh from from where we were in march and consumer expectations of inflation are actually stable and then this is where folks also say hey look kevin literally uh you know i have it right here on the bloomberg terminal in reuters terminal we literally just while i've been yapping here just three minutes ago got two big updates we got a beat like a a substantial beat on factory orders up over two percent versus the one percent expected which is a sign that i don't know i mean the consumer's still spending which echoes literally what we're seeing in all of the earnings reports all of the earnings reports that we're getting whether it's uh you know uh apple the chipsets the airlines the banks uh individual companies you name it the consumer spending so it doesn't it's not a surprise that we also just got the jolts number which is jobs openings and uh we were expecting 11.2 million job openings we actually got 11.5 million which means that like businesses aren't really worried about a stagflationary recession uh because job openings are here you know like layoffs and stuff tend to happen after a recession has started but like job openings are a nice oftentimes leading indicator uh so so anyway uh the rest of the year obviously will will really matter in terms of what the fed does the fed is expected not to shock and us but they are expected to front load some some of their actions and the hope is again this is just a hope that in order for us to really avoid a very painful stagflationary recession we need inflation to go down naturally not to get paul volckerd and the fed to just go back to like neutral or slightly accommodative uh but not like super aggressive like where paul volckery and uh and absolutely destroy this economy because the fed could do that if a paul volcker by the way would look like this inflation's at eight and a half percent the fed goes fine we'll set rates at nine percent that's a paul volckering like people are worried about 50 basis points and i'm like this is moronic like who cares we're at a quarter basis point now for the fomc you go up a half percent we're still at .75 like come on man we need to be above two percent to be above neutral and we're not even close to where inflation is so like these fed hikes are super nominal we're not getting paul volcker here we're just like slightly turning the hose off a little faster than the market likes in the market like oh yeah it's the end of the world and the way the end of the world like actually doesn't happen is the stag the inflation part of stagflation goes away and we're starting to see signs of that and so personally i'm really optimistic but that doesn't mean that 2022 is still not going to suck but again if i if i zoom out and i'm like well let me look at the history of markets where do i want to invest do i want to invest when the market's at bottom or do i want to invest you know when everybody's euphoric and happy well i'd rather invest in a recession and i think 2022 is actually the year of recession whether that's we have a positive and negative first half or a positive or an or i'm sorry an all negative first half or an all-negative second half or or some combination where it's like it's negative positive negative negative and we have a recession at the end i don't really care i think it's setting up for low comps for easy beats in 2023 uh and then your recessionary fears go away uh that's it's all moved up since the last gdp report but those are just my thoughts so my thoughts on the stagflationary recession you want to talk to me in private lives you could do that as well especially the real estate ones okay so that's my talk on stagflationary recession
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