The last time I wrote about inflation was August 2011. Since then, rising prices was seen as a high-class problem that would return only if the economy and the equity markets ended their addiction to lower rates.
That looks to be the case now. While long-term bonds sold off more than 8% last month, stocks managed an impressive post-election rally. There are scads of reasons to explain the end of the years-long relationship between lower rates and higher stock prices, with the ones most often cited being the potential for increased fiscal spending and lower corporate tax rates.
This new inflection point not only means that portfolios need a re-think, it also marks some important talking points for clients as we approach year-end.