Globally producer price indexes have turned down quite decisively. China is trying to deal with deflation.
There are two main explanations, with diametrically diverging investment outcomes.
Under the first scenario, producer price inflation is a leading indicator for consumer price inflation. Falls in the producer price indexes will inevitably flow through to inflation indexes. Sell stocks, buy bonds.
Under the second scenario, the gap is an indicator that companies continue to be able to expand margins. It is a sign that companies are raising prices to consumers faster than their own costs are growing. Buy stocks
Join us in this week's podcast as Nucleus Wealth Chief Investment Officer Damien Klassen and Senior Financial Adviser Samuel Kerr dig into the arguments and look at the evidence.
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Nucleus Wealth is an Australian Investment & Superannuation manager that can help you reach your financial goals through transparent, low-cost, ethically tailored portfolios. To find out more head to Nucleus Wealth Website.
The information on this podcast contains general information and does not take into account your personal objectives, financial situation or needs. Past performance is not an indication of future performance. Damien Klassen is an authorised representative of Nucleus Wealth Management. Nucleus Wealth is a business name of Nucleus Wealth Management Pty Ltd (ABN 54 614 386 266 ) and is a Corporate Authorised Representative of Nucleus Advice Pty Ltd - AFSL 515796
2.25 An SMSF Investment Masterclass
2.24 Flight to Quality
2.23 Ethical Investment Essentials
2.22 Australian Debt Crisis Playbook
2.21 Oil canary dead in the cage?
2.20 What's next for the RBA?
2.19 Aussie Dollar to Dazzle?
2.18 Is the beast back? - The Future of Australian Property
2.17 Trade War Explodes
2.16a Nucleus Instant Insights - Mega Trends
2.16 Mega Trends
2.15 Housing Bust Ending?
2.15a Nucleus Instant Insights - Housing Bust Ending?
2.14 Special Guest - Matt Barrie (freelancer.com)
2.13 Changing Tack
2.12 - Special Guest Denise Brailey
2.11 How Low Will They Go?
2.10 Special Guest - Damien Boey (Credit Suisse)
2.9 Special Guest Aleks Vickovich (Your Money)
2.8 Special Guest - Philip Soos
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