Deep Inflation Negative Surprises in 2015: De Longis

The video discusses the impact of energy prices on inflation, highlighting the challenges in forecasting due to rapid changes. It compares the cyclical nature of emerging markets with the US economy, emphasizing the importance of understanding market divergences for investment. The role of high yield as a leading indicator of risk appetite is explored, noting its resilience despite challenges. Finally, the video examines inflation expectations, suggesting that core inflation remains low and questioning the urgency of reaching inflation targets.

What is a significant challenge for forecasters when dealing with inflation surprises?

• Overestimation of agricultural impacts

• Lack of historical data

• Rapid changes in market conditions

• Inaccurate energy price predictions

How do emerging markets differ from the US in terms of market cycles?

• They are more stable

• They are less affected by global events

• They are more cyclical

• They have a constant growth rate

What is a key factor for investors to consider during cyclical divergences?

• Understanding relative value stories

• Avoiding all investments

• Investing in any equity market

• Focusing solely on US markets

Why is high yield considered a good leading indicator of risk appetite?

• It only affects the energy sector

• It is immune to liquidity issues

• It reflects general risk appetite

• It is unaffected by market cycles

What is the current state of core inflation excluding food and energy?

• Rapidly increasing

• At very low levels

• At very high levels

• Unpredictable