Home Trading The Best Lubricant For “Sticky” Inflation

The Best Lubricant For “Sticky” Inflation

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This week, the Biden administration announced a $500-billion Student Loan Forgiveness plan…

Which, of course, isn’t “forgiving” to hard-working taxpayers who will be saddled with the bill…

But that’s another story for another time.

I wish I could say this was a “stunning development”… but the fact is, I could smell it from a mile off.

Buying votes is a tale as old as time and not only is this an obvious play…

It’s also absolutely PERFECT timing.

Faith in the courts is at an all-time low with your average college-educated, upper-middle-class voter…

The only demographic with which Uncle Joe’s party is currently gaining favor.

So, when the justification for the bailout — an emergency COVID power — gets stifled in the courts…

And your average over-levered, post-grad learns that they can’t foist a chunk of their “Master of Studies” degree onto the taxpayers…

They’ll turn their ire on the courts and vote for Biden’s party to enact “judicial reform” – that is, burn down the 3rd branch of government by expanding the courts.

It’s a pretty disgusting and brazenly self-serving political move that will lead to nothing good…

… but such is the state of play in the modern populist political era.

But I happen to think there’s more going on under the hood than some partisan knife-fighting…

It could just be a symptom of structural decline that’s starting to hurt everyone (including the college-educated).

We’re reaching diminishing returns on the innovation that started in the mid 90s or so…

Which is taking some of the air out of the deflationary pressure we get from better technology.

Add in a dash of geopolitical and economic fallout from COVID and cheap goods from abroad become less plentiful…

Finish it off with an impending energy crisis (also structural)…

You get the perfect storm for sticky inflation which could end up making life awfully expensive….

When life gets expensive, the people get restless…

When the people get restless, the elites turn populists…

When populists get power they appease the people with bread and circuses…

When bread and circuses are financed with public debt, things get more expensive.

It’s a raging doom loop that can lead to violent uprisings… like we saw earlier this summer in Sri Lanka.

The one release valve we still have in our (mostly) free enterprise system…

You don’t have to violently raid the refrigerators of the ruling class to fill your belly…

When you can access capital markets with the click of your mouse.

It’s a great way to become the lord of your own manor…

You can generate more aggressive returns and stay away from the business end of the inflationary muzzle.

The problem for your average “Retail Randal” is that he needs to bid against the ruling class who have access to privileged intel.

The solution to this information imbalance is to learn what the ruling class is doing.

>>> Raid The Ruling Class By Siphoning Off Their “Insider Intel”

Original Post Can be Found Here

Author: Steven Place

Steven Place is the Chief Strategist at Market Traders Daily. MTD helps investors and traders identify high-profit setups through world-class analysis and trade alerts.

Steven has been developing trade systems and risk management techniques for a decade now.

Through the use of a select few option strategies, Steven teaches clients how to build aggressive and sustainable wealth in the options market.

He lives on the Gulf Coast of Florida with his wife and daughter.

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