Friday, The reinflation trade, Quad 3

The Quad 3 continues. (Hedgeye) The reinflation continues. 

For the last few days the momentum trade has been in the toilet. 

It looks like today we will get a bounce in some of that stuff and a chance to reshort it.

The broadening rally in the share market continues, Healthcare, Dividend, value, bond proxies, Reits ect.

So far bonds have been in the toilet, speaking of bonds, more disinflation and deflationists are caveing, they are at the point where they say publicly that they sold their bonds and believe the Fed isnt serious about rising inflation.

Mike Green has said as much in podcasts. He thinks there maybe a deflation scare but it will be met with more inflation policies from the Fed.

I think he is right. He even admits to owning to much gold.

I think there is a rising concensus that the Government and Fed will bail everyone out with rising inflation. 

Hugh Hendry has said as much about Japan. 

Anyways I think rising inflation may cause a rising share market in some countries, despite how in the past rising inflation led to down share markets. 

There has been so much wealth created in the world that much of it will go to traditional assets such as gold, and real estate. 

Markets have changed and evolved so now people will use that information and wealth to protect themselves from these government policies. 

Or maybe im wrong and voters will vote to cut their benefits. I dont know but will go with a trend following policy, with a gold coin holding.

Thanks for reading.