The first paragraph clarifies my point and I believe we are largely in agreement. The difference I see in our views is that I don't consider asset price increase without CPI increases as inflation -- it is a materially different beast (it doesn't increase commodity prices or depress buying power of wage earners for day-to-day needs.)
Your second paragraph is exactly what I meant by wealth inequality. I don't think rich people buying things will increase CPI, but it does impact positional goods like college and real estate.
So far, the Fed has been providing liquidity to MBS but not enough to prevent real mortgage rates from _rising_ currently. I believe unemployment will remain high enough for long enough to stave off a housing price increase.
The sell-off of equities as boomers retire and live off their stock portfolios is also something to consider as counterbalancing equity prices over the medium to long-term.
I believe the prevailing belief is that we'd be in a deflationary period without Fed intervention.
Your second paragraph is exactly what I meant by wealth inequality. I don't think rich people buying things will increase CPI, but it does impact positional goods like college and real estate.
So far, the Fed has been providing liquidity to MBS but not enough to prevent real mortgage rates from _rising_ currently. I believe unemployment will remain high enough for long enough to stave off a housing price increase.
The sell-off of equities as boomers retire and live off their stock portfolios is also something to consider as counterbalancing equity prices over the medium to long-term.
I believe the prevailing belief is that we'd be in a deflationary period without Fed intervention.