3 Things I Think I Think - Bad Narratives

2025-02-13 03:30:00 ET

Summary

• Inflation has averaged 3.5% historically and CPI came in at 3%. So we’re not even seeing a “wave” that is above average height so far.
• There’s been an explosion in so-called “memecoins” in recent weeks. These are bad assets that have no underlying economic utility and no reasonable value basis.
• The government is a huge aggregated sector comprised of thousands of individual components. It can’t run out of money any more than the aggregated private sector can.

Here are some things I think I am thinking about:

1) Inflation Still Isn’t Scary

In the wake of Wednesday’s CPI report, there were all sorts of scary narratives about how inflation is raging and we’re on the verge of a big second wave of inflation. I’m not much of a surfer, but if this is a second wave, then it’s a pretty pathetic one so far. In fact, inflation has averaged 3.5% historically and CPI came in at 3%. So we’re not even seeing a “wave” that is above average height so far....

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