Inflation woes keep coming

Happy Friday eve, readers.?I'm Phil Rosen coming to you from New York. There are so many inflation calls that it can be difficult to keep track of where the top voices say we stand.?

At least one official is ready to admit they were wrong on the issue as prices continue to rise.?

Let's jump in.?

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1. Janet Yellen says she was wrong about inflation.?Last year, Treasury Secretary Yellen shrugged off inflation. She had called it a manageable risk.?

This week,?Yellen gave a different take.?

"I was wrong then about the path that inflation would take," she told CNN. "There have been?unanticipated and large shocks to the economy…that at the time I didn't fully understand, but we recognize now."

Now, the Fed is going to have to do?whatever it takes?to tame surging prices, according to top economist Mohamed El-Erian, even if it means going?full bore?with multiple rate hikes.?

"We're going to be talking about this problem next year"?if the Fed loses conviction, he said Wednesday. "And the consequences are not just for the markets but for the real economy and?the most vulnerable segment of our society?are going to be even more consequential."

The implications of prolonged inflation for the stock market are dire. Stocks could see more steeper declines?if Fed Chair Jerome Powell doesn't act fast. Already, indexes have plummeted this year, but?high prices could keep dragging on shares, Barclays analysts wrote yesterday.?

"As a result of the current high levels of inflation, our fair value model points to further downside risk for valuations (~10%),?especially if inflation does not subside quickly," analysts wrote.

In other news:

2. The investing chief for a $120 billion wealth manager breaks down what could spur stocks to rally and break out of the bear market.?Alexander Chaloff laid out three scenarios where stocks rebound by the end of 2022:?"We're clearly near the bottom."

3. A top market technician told investors to double down on energy just before it surged 42%.?JC Parets broke down five trades that could now buck the bearish trend in the markets —?and shared three signals to watch before going all in on crypto and stocks.

4. Deutsche Bank's chief strategist said stocks could jump another 15% by the end of the year.?There's still more downside ahead, but that doesn't mean a strong rally is out of the question, according to the top exec.?Here's why he's bullish even if a recession kicks off soon.

5. Job openings dipped from record highs in April.?The US boasted 11.4 million job openings at the end of April, down from the prior month's 11.9 million.?The data shows companies are still grappling with the labor shortage.

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