A Familiar Sight: Higher Equity Prices & Rising Inflation Expectations
August 08, 2012 at 09:03 AM EDT
The market’s inflation outlook has popped a bit in recent weeks. The stock market has moved higher too. The new abnormal, in other words, remains intact. The new abnormal is my label for the unusually high positive correlation between changes in the stock market and inflation expectations, as defined by the 10-year Treasury’s yield less [...]