Inflation Will Continue to Rise and Persist Amidst a Flattening Yield Curve

Real Vision: Finance & Investing

Real Vision

Business News, News, Investing, Business

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🗓️ 28 October 2021

⏱️ 32 minutes

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Summary

DB-Oct 28,2021: The last time Harry Melandri of MI2 Partners was on the Daily Briefing, he urged people to sell their Euro Dollars due to high inflation and a strengthening economy. Those factors continue to prevail, and Melandri says he expects inflation to soar higher and continue to apply pressure. Naked Wines, an online wine retailer in the U.K. that ships monthly wine subscriptions throughout the U.K., U.S., and Australia, bubbled up 30% after hedge fund manager Glen Kacher unveiled it as his fresh pick on CNBC’s “Halftime Report” show. Weekly jobless claims filings dropped to a new pandemic-era low of 281,000, indicating a steadily recovering labor market. Interviewed by Maggie Lake. Want to submit questions? Drop them right here on the Exchange: https://rvtv.io/3mlbxvh Learn more about your ad choices. Visit podcastchoices.com/adchoices

Transcript

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0:00.0	Hello and welcome to the real vision daily briefing. It's October 28, 2021. I'm Maggie Lake.
0:11.1	And with me today is Harry Melondri, advisor to MI2 partners and frequent referee for
0:17.6	real vision insider talks with Julian and Raal. Harry, nice to see you. It's great to see
0:22.8	you again. Maggie, how are you? I'm doing well. Thanks. So we have just let's get a quick snapshot
0:28.4	where we stand before we dive in. And we have US stock markets once again close to record highs
0:33.7	and the yield flattening in the bond market. ECB president, Chris Lee in the guard saying inflation
0:39.2	may be around for longer than expected and Facebook going meta literally officially changing its name
0:46.3	and trading under the ticker, MBRS as of December 1st. What do you make of this market action?
0:53.6	So stocks are going up. I keep on trying to get out of them. I keep on being forced back into them.
0:59.4	And I'm missing out my, you know, I have relatives who are doing way better than me because they believe in stocks.
1:06.8	The bond market is a far more interesting place in most people realize. There's a lot going on
1:12.8	in short rates. The flattening in the curve is a symptom of pain. It's a pain trade.
1:22.0	Most people, you know, if you're trading your own 401k, you won't notice. But if you're,
1:26.7	there are hedge fund managers right now who are wondering whether they're going to have to sell one of
1:30.5	their penthouses. So wait, wait, I actually, we did see, there's been some talk about the fact that
1:36.5	that the hedge fund community who we expect to be wiser and much more seasoned than all of us
1:42.0	are really struggling with rate trades. But what do you mean this is a train, a trade of pain?
1:46.8	What do you mean by that? People got it wrong. So now, every now and then, even a blind dog gets
1:54.0	a bounce. The last time I was on, you remember, I was pushing the idea, which my colleagues trade
1:59.4	idea, that we should, that people should be short EDs. And why were you saying that? Because the
2:06.4	inflation prints are going to be unremittingly high, because we're actually, we're still going
2:13.4	to see high prints for the foreseeable future. It's one thing to say transient. But after about
	...

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