Hate to say we told you so, but this inflation train is moving into high gear and will remain strong throughout 2022, particularly as higher home rental prices start to flow through the Fed’s home rental price surveys.
Our view is that the Fed will be forced to accelerate its tapering effort to perhaps conclude in March or April rather than June. In addition, don’t be surprised if the Fed begins to lift the Fed Funds Rate in April, May or June of next year rather than sometime in 2H 2022. Technology investors ought to stick with cash rich, dividend paying companies such as Microsoft, Alphabet and SS&C Technologies to name several. Outside of Technology names we continue to like commodities and precious metals given that more money printing is on the way courtesy of fiscal policy subsidized by the ever accommodating Federal Reserve.