We Study Billionaires - The Investor’s Podcast Network TIP370: Inflation Masterclass w/ Cullen Roche
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Aug 15, 2021 Investment expert Cullen Roche returns to share his profound insights on inflation. He breaks down what inflation really means and dispels common misconceptions. Cullen discusses how consumer expectations drive inflation and whether current trends are temporary. He dives into how inflation impacts real estate prices and the regional differences that exist. Additionally, he shares investment strategies for thriving in an inflationary environment, including the benefits of debt and real assets, offering a comprehensive guide for navigating financial markets.
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Inflation vs. Money Supply
- Inflation is an upward movement in the price of goods and services, not simply an increase in the money supply.
- Money creation through lending doesn't inherently cause inflation, as it depends on how the borrowed money is used.
Base Effects and Transitory Inflation
- Base effects can exaggerate inflation, similar to how stock market gains look bigger after a drop.
- "Transitory" inflation means the rate of change will slow, not that prices will revert.
Inflation Expectations and Drivers
- Expected inflation can become a self-fulfilling prophecy, driving actual inflation higher.
- Various factors beyond monetary policy, like demographics and technology, influence inflation.