Stocks are down quite a bit, along with corporate and government bonds. Why is that? Well, given that valuations have been at elevated levels, it doesn’t take a lot to scare markets. To make a simple analogy, when valuations are at stretched levels, it is like a plane flying at full speed – a little turbulence can have a big effect. The reason markets are starting to fret is because measures of inflation have started to rise, both in the US and in China. There are a lot of moving parts to this issue, and it is worthwhile doing some digging…

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