Keep this information in your battle chest as there are very few who know what I am about to share with you.
INFLATION IS ONLY MEASURED AND PREDICTED BY THE MONETARY BASE.
Don't waste your time with Core PPI or Core CPI or PPI Ex this and that and the other.
It is useless!!
The true measure of pricing pressures is the change and growth in the monetary base.
This is an all encompassing piece of data and covers everything you could possibly need to know
about the liquidity of the economy.
So it is as simple as this. Compare the Monetary Base of the Last 2 Weeks to the most recent 2 Weeks and multiply by 26. This is one stat. Now here is the most reliable and the toughest.
Take the current Monetary Base and compare it to the Monetary Base from a year ago and Viola, you have the inflation rate. You will be the envy of economists and wall street when you see how accurate you are with these numbers, but keep the secret to yourself.
By the Way, the current reading of the monetary base is a very tame 1.73% yearly inflation rate, so all the doomsday advocates who think the inflation rate is going to spiral out of control are way off the mark and you are smart enough to know it!! So use it to your advantage and know that once this market corrects on an intermediate term basis and the sky is falling crowd is out in force, then it will be time to purchase quality equities and quality leaps.
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