Whenever ever the market is down, I can always count on Micheal Burry the Big Short investor articles about how he thinks it's going to get worse, or is just like the one time he called it
Some people are always pessimistic and some people are always doomy. Let's look at some of the factors causing inflation:
* Office workers move from cities to poor / rural areas - suddenly they need to drive more, serving their needs is less efficient, they need more cars, goods. You can see this by looking at the distribution of inflation across the US - it is highest in the office worker migration destinations. Maybe the cities will get cheaper as they empty out, maybe now everyone who bought a much bigger house and needs furniture has it. The increased demand due to less efficient living will be sticky.
* There are supply shocks - sanctions on russian oil, grain, disruptions to Ukrainian exports, china shutdown. These are probably temporary in the medium term.
* The demands side is still suppressed - Chinese economy is stalled for multiple reasons, Asia generally is not fully out of COVID, US consumer confidence is falling. If / when China suddenly decides to stimulate with big infrastructure projects we will see more demand pressure.
* OPEC previously supressed oil prices to fight american shale and arguably russian oil. These high prices will lead to a resurgence in these competitors. At some point they will turn the taps back on to maintain their monopoly.
Writing this incomplete list above, the case I hope to make is that things can get better or worse than here driven by events, but high inflation is probably with us for a while.
> Burry diagnosed the "greatest speculative bubble of all time in all things" in June 2021, and warned buyers of meme stocks and cryptocurrencies were headed for the "mother of all crashes."
Such amazing insight. There is a doom bloviaton roster who get trotted out in the financial press to state the obvious post-facto every time there is a market correction and they can generally point to their track record of having predicted 20 of the last 3 crashes.
> Burry diagnosed the "greatest speculative bubble of all time in all things" in June 2021, and warned buyers of meme stocks and cryptocurrencies were headed for the "mother of all crashes."
Firstly, a vast swathe of commentators have been saying for some time that it's a bubble. You don't need to be some sort of prophet to see that reddit meme stocks and half-million-dollar monkey jpeg profile pictures constitute a bubble.
Secondly just saying that the squiggly line is going to go down at some point in the future is not insight. Ask Melvin Capital how spotting the bubble in meme stocks worked out for them. Markets can remain irrational longer than you can stay solvent and all that.
Listening to these guys (or the shills who keep saying things will go up because they're no different) is like when they conduct a prematch interview with an athlete. "What's your plan for the game?" "Well what we gotta do is score a lot of points and stop the other guys from scoring points. If we can do that, we'll win."
How is that going to get you any closer to a solution though? Inflation ratchets, so even if you powered all the factories and ships and trucks with magic it's not going to people their real-term savings back.
It would mean that when oil/energy prices go down, then prices of many goods should also drop, potentially erasing the inflation.
A decent amount of energy production was taken offline when oil futures went negative. Then the war in Ukraine and resumption of travel means 3 factors pushing up energy prices all at once.
Some of those people are genuine experts, but that list is pretty patchy. Tom Seibel and a couple of guys from "shark tank" aren't exactly legendary investors. They're the people you get a comment from when your listicle is too short, a deadline is fast approaching and Warren Buffett, Ray Dalio, Mohammed el Erian and about the next 30 people don't get back to you.
