Meme Watch - Inflation

I like to watch "memes" work their way through the media. A "meme" is a fairly recent phenomenon. As far as I can tell, a "meme" is a general ideal or theme prevalent in the current news cycle. Ya know how sometimes it just seems like all the media is talking about the same thing? That's a meme. Some of them impact that markets, and some of them don't.

One current meme I'm tracking is the Inflation meme. This is the story that takes a look at isolated numbers and attempts to show that Inflation is in danger of getting out of control. This is a very new meme for our economy since only months ago the Fed regarded Inflation risks as equal to Deflation risks. However this meme has found it's way into the psyche of the stock trader's head and the talking head alike. Why would we be getting the best earnings reports in years, yet have the stock market seem downright uninterested? The Inflation meme.

Now I've been on what seems to have been a never ending search for inflation for the last two years and I feel very comfortable in reporting that there IS core inflation going on (raw materials, hard goods, et al). However the real measure of inflation, the cost of money, is still quite low and likely to move slowly up the inflation scale. Imagine a big jumbo airliner taking off at super slow motion. So the truth is that inflation is coming, but it is coming at us slowly giving us enough time to reposition and prepare.

The moral of this meme? Get ready to get ready, and be forewarned, but don't jump off a cliff.