The Dividend Cafe Tuesday - January 13, 2026
Jan 13, 2026
Market experts dive into a sharp 398-point drop in the DOW and analyze the latest inflation data, revealing a year-over-year rate of 2.7%. The discussion covers the Federal Reserve's restrictive policy stance and its implications on future interest rates. There's skepticism about the Trump administration's $200 billion mortgage bond buying initiative and its long-term benefits. Additionally, the complexities of housing affordability are discussed, emphasizing that policy changes alone won’t suffice without addressing supply-demand dynamics.
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Inflation Is Near But Above Target
- The December CPI showed 0.3% monthly and 2.7% year-over-year headline inflation. Core CPI was cooler at 0.2% monthly and 2.6% year-over-year, signaling inflation is moving closer to target.
Services And Shelter Keep Inflation Sticky
- Core services and shelter components remain elevated and contributed meaningfully to the CPI print. Those components represent roughly 40% of the inflation basket and keep headline inflation sticky.
Markets Largely Took CPI In Stride
- Bond markets and Fed futures barely moved after the CPI print, indicating the report was largely in line with expectations. The 10-year yield only changed by about one basis point on the day.