They're going to lower rates again. They have to. So prepare for more inflation.

As of Q2, consumer bankruptcies were hitting 10 year highs and shooting higher with the largest jump in the same period (1). There was even acceleration from Q1 to Q2. We don't have Q3 data yet, but one can only assume we've gone alarmingly far into uncharted territory*.

This will cause a colapse in demand, which is the only way prices will ever come back down. But they'll never allow it. It's going to hit corporate earnings. Right now is Q4 earnings season. You'll see. And corporate bankruptcies will spike soon after. They're all addicted to cheap credit same as consumers are. That's the way this needs to go. Consumers need to file for bankruptcy and reset their lives. Corps need to get fucked and sold off for pennies. But we all know it won't go that way. They'll apply pressure where it matters to politicians, who'll apply it to the Fed to lower rates again.

Beyond that, we're on track to spend more servicing Federal debt than we spend on the national defense budget BY 2025 (2). Politicians have only two years to address this. And we know they can't. And that's actually optimistic, assuming treasury auctions keep supporting the same price (highly likely yields will keep going higher all things being equal, traders are coming to realize there's some risk of default here, which raises risk premiums).

Corps and the Fed gov will team up to fuck us again. They always do. So do what you can to be ready for it.

*: They've been higher before, but not since we've had 10 years of zero interest rate policy. That decade has baked assumptions into the economy. Everyone has gotten used to the status quo and made bets based on it continuing. The foundation shifting under everyone's feet is bound to cause cataclysmic shifts thru the whole system.

1: https://fred.stlouisfed.org/series/DRCCLACBS

2: https://www.cnn.com/2022/11/01/economy/inflation-fed-debt-military/index.html