Ronald Stöferle as guest of The Market Huddle
A year like no other.
This year we saw interventions and stimulation on an unprecedented scale. Central banks reacted much faster and more aggressively than in 2008, but at the same time markets became more and more addicted to more and more stimulation. Like a drug addict, the dose is simply no longer sufficient and must be constantly increased. But this time it is different, inflation is desired.
Inflation on the horizon
Many factors point to higher inflation in the near future. The biggest factor is that we simply cannot afford to allow deflation to continue. Another point could be the upcoming “Cold War 2.0”, which could have an inflationary effect. Furthermore, politicians and central bankers around the world are busy initiating large expensive infrastructure projects as well as other major government projects.
Dawn of a new era
With the probably underexposed changes of the US Fed this summer, a new phase will be initiated. The old measures of the central bankers have largely lost their effect. To achieve a small change, more and more extreme measures must be taken. Ronald believes that now is the time and inflation will once again become a central issue. The problem is that nobody is prepared for it.
A Healthy Sector
The current bull market in the mining sector has only just begun. Ronald sees that the companies are currently in a very healthy state and ready for their party. Currently she is still young and the evening is still long. As at any party, some will have to overdo it and live with the consequences.
Delayed
Ronald compares the stimulation and action of central bankers to drinking tequila shots. The first few are okay but at a certain point you lose control completely. By the time the current fiscal policy measures have an effect, so much will have accumulated that there could be a loss of control.
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