Inflation Is Heating Up.....

Inflation is heating back up this week....in the prices of stocks.

I’m no CPI whisperer. I tend to focus on the message of the market.

I’d rather watch how the real experts react, and then place my bets accordingly.

Their actions show up in price. And price, while imperfect, is the closest thing to perfect we get in markets. 

In price lies the truth. 

And based on the market’s reaction?

Inflation is red hot in the stock market.

• +70% of Nasdaq 100 stocks were up
• +80% of S&P 500 stocks were up
• +90% of S&P 400 (Mid Caps) and S&P 600 (Small Caps) were up

This is a feature of Bull Markets, they solve problems.

Hand up — over the weekend I was even talking about selfish play from the Mag 7. 

But the nuance is that warning signs aren’t a reason to panic in a Bull Market… they’re a reason to prepare.

You don’t ignore them, you just don’t overreact to them.

"Often times in Bull Markets the brakes aren’t for stopping, they’re simply for loading up on more gas."

The lesson today isn’t buried in the CPI print. 

It’s in knowing the market regime you’re in.

So while some focus on the potential for the “bad” kind of inflation, they’re missing the opportunity to participate in the kind happening right now…

Stock price inflation.

Anyways, that’s my two cents.