Team Stagflation, or Team Transitory?

Stagflation fears are rising again. It's a natural reaction to the short-term data. September headline CPI came in hot, though the core CPI print was in line with expectations and PPI was soft. Inflation expectations are spiking...

...while the Atlanta Fed's GDP nowcast is plummeting. Consumer confidence is dropping, driven by supply chain bottlenecks and rising costs. The combination of these factors is becoming a threat to corporate profits.

As a QE taper is more or less baked in for November, these worries have unsettled markets as the narrative is that the Fed could be making a policy mistake. Should investors cast their lot with Team Stagflation, or Team Transitory?

The full post can be found here.