Based on liquidity and economic cycles, the increase in money supply from previous crashes and attempts to avoid deflation, looks like we will be entering a hyperinflationary period. At the same time, the FED has to be careful in attempting to raise interest rates preemptively for political reasons. The FED has some autonomy in its policy making. But if policies aren't inline with upcoming economic policies from POTUS. The FED may be audited and face political backlash.
Looks like we will see bonds getting decimated in anticipation of the spending/hyperinflationary period that may be arriving soon. In order to foster equity appreciation and the wealth effect, FED FUNDS may be kept at low levels, and slope of yield curve will increase tremendously.
- short long end of the curve
best to wait for retrace before attempting to short.
- US dollar will face continued appreciation unless intervention takes place.
intervention may be needed, and currency wars breakout to foster US corporate competiveness.
- US equities will rally..
If a hyperinflationary period is upon us, Gold may rally, especially if USD is kept suddued. But as USD rallies, Gold faces downdrafts.
Some metrics of the anticipated economic spending.
Lumber
Copper
