Will the 1970’s Return?

No, I am not talking John Travolta, ABBA, or the Bee Gees. I am talking about inflation and what former NY Fed William Dudley said when he was recently interviewed by Bloomberg’s Tom Keene and Jon Ferro. Here are some insights from the interview—
· The current Fed will be much slower to tighten than previous Feds.
· They will start raising short-term interest rates too late for sure. William says, “the question is really how late and then how high will they have to raise short-term rates, to basically keep inflation from continuing to accelerate?”

Thus, don’t be surprised if inflation goes much higher and mortgage rates go much higher in the next 2 years. And then the stock market may crash as well. Keep a lot of money in savings. I am worried we may see a repeat of the 1970’s and early 80’s.