Russell Napier: Central Banks Have Become Irrelevant

the market:

The Scottish market strategist Russell Napier warns that investors should prepare for inflation rates of 4% and more by next year. The main reason: Governments have taken control of the money supply.

In the years following the financial crisis, numerous economists and market observers warned of rising inflation in the face of the unorthodox monetary p0licy by central banks. They were wrong time and again.

Russell Napier was never one of them. The Scottish market strategist has for two decades – correctly – seen disinflation as the dominant theme for financial markets. That is why investors should listen to him when he now warns of rising inflation.

"Politicians have gained control of money supply and they will not give up this instrument anymore", Napier says. In his view, we are at the beginning of a new era of financial repression, in which politicians will make sure that inflation rates remain consistently above government bond yields for years. This is the only way to reduce the crushing levels of debt, argues Napier.