This month Jason Weaver discusses Core CPI, the Russia/Ukraine Conflict/Commodities and Quality.
Core CPI
Aggregate of prices paid by urban consumers for a typical basket of goods, excluding food and energy
Core CPI is widely used by economists because food and energy have very volatile prices
February Core CPI rose 6.4% (highest since August 1982)
Russia and Ukraine Conflict/Commodities
Russia is a commodities powerhouse, producing and exporting materials the world uses to:
1/10 of the world’s aluminum and copper
1/5 of battery grade nickel
1/2 world’s neon production for chips
1/3 of the world’s wheat, corn and meat
The invasion of Ukraine is constraining crucial supplies as Russia becomes increasingly isolated from the global economy, driving up prices in the process.
Quality
The stock market has been riddled with high inflation, monetary policy tightening and the Russia-Ukraine war.
High quality stocks are widely favored to combat uncertainty
Quality companies have the following characteristics
Higher /reliable profits
Low debt
Sustainable earnings
