Important Information From The Selloff

This selloff is demonstrably different than other corrections the market has endured this cycle in one important aspect: it has inflationary rather than deflationary notes to it. This is an extremely important point of context because it tells us something about market participants' anxieties. Specifically, it suggests that investors are more worried about an inflationary bust than a deflationary bust, a distinction that informs the asset classes most likely to outperform in the months and quarters ahead, as well as those assets that may act as the most effective hedges to downside volatility.