Still Waiting For Inflation

In a Financial Times post, president and chief investment officer of Pacifica Partners Capital Management AJ Sull says that U.S. inflation doesn't seem to be on the horizon. The monetary base has been flat for the last eight months; bank credit, despite a jump in early spring, is still below where it was in early 2009. The monetary picture still suggests the Fed was pushing on a string; the potential inflation enngendered by the earlier doubling of the monetary base has not been actualized.

Despite the addition of Keynesianism, and a seeming obliviousness to the possibility of stagflation, Sull has a point regarding the monetary side of things.