April 2021

Euthanasia of the Lender

During the last decade, stock prices have benefited mightily from falling interest rates and a persistently low inflationary environment which has defined many forecasts.

Inflation, once thought to be well understood in the days of Milton Friedman as “always and everywhere a monetary phenomenon,” may not be that at all. And the conventional understanding — that decreasing interest rates will spur inflation higher — is being challenged. Today, a new line of thinking argues that inflation is a matter of demographics, one greatly influenced by China’s emergence as the “factory of the world.”

In a new article on our website, John R. Gilbert, Senior Research Consultant, explores this concept and provides insight on how a new understanding of inflation could influence asset allocation decisions moving forward.

John R. Gilbert

Senior Research Consultant