#856 Inflation is At Least 10% w/ Darius Dale

— Inflation is running at approximately 10% on a month-over-month annualized basis, with the official 7.9% figure masking underlying momentum that is accelerating rather than moderating.

— The Federal Reserve faces a credibility crisis on price stability and will likely engineer a recession by raising rates aggressively, as the alternative (allowing inflation to destroy real incomes) would be worse for central bank credibility.

— Shelter inflation data (33% of CPI) is substantially understated; national rents are up 18% and home prices up 19%, yet the official number shows only 4.7–4.8%, creating a measurement lag of approximately six to twelve months.

— Energy prices (crude oil up over 200% on a two-year basis) are accelerating faster than any comparable period since the 1970s, making a structural bear market more likely than a typical recession.

— Asset valuations remain vulnerable; household equity ownership is at an all-time high of 30% of net worth, leaving retail investors with little dry powder to buy dips as markets decline.

— The financialization of markets through explosive growth in options activity is creating larger, more frequent tail-risk events (fat tails, or "leptokurtic" distributions) across equities, commodities, and crypto.

— Raise cash and move defensively now. Most retail investors hold record equity and crypto allocations as a share of net worth with minimal dry powder for dips; positioning for a bear market rather than attempting to catch falling knives is prudent.

— Expect a 50+ basis point rate hike within months. The Fed's forward guidance ("we'll do whatever it takes") signals aggressive tightening; 25 bp increments will likely accelerate to 50 bp by May or June if inflation momentum persists, increasing recession probability and equity drawdown risk.

— Monitor shelter, energy, and food inflation closely. Official shelter data lags real rent and home-price increases by 6–12 months; energy and food volatility are accelerating faster than historical precedent, making the next CPI print (and each subsequent print) a key catalyst for policy and market moves.