Let's get Real: Economic data in Real terms

Headline data tricks us into thinking that all things are inflationary and that growth is "real". However, when we look at the data in REAL terms, provided by the US Census Bureau, the inflationary rhetoric couldn't be more wrong.

We can see that before a major market correction we observe disinflation pressures in real wage growth. Although the consensus provides us with only 2018 data, a higher frequency wage and salary growth numbers can fill the gap.

COVID-19 was the catalyst that triggered wage disinflation into a full on deflation. And somehow the stock market seems to keep on truckin'. What is more alarming is the fact that the US 10-year has been trading in the negative territory in real terms, even before the inception of full-fledged corona lockdown .

With everything arb'ed out is the primary distressed securities market the only place for yield? Buying at extreme discounts and selling it at or below par?

More knowledge, more power.

-cs