My webinar with Michael Yardney: INFLATION – who’s hit hardest, what’s driving inflation, implications for investors

• Yesterday, Australian CPI inflation came in at 3.8% for the 12 months to June 2026. Down from 4.6% in March, but still well above the RBA’s 2-3% target. ‘Trimmed mean’ CPI is also still well above target at 3.6%.
• Despite inflation remaining too high, real rates still too low, and Federal & State governments continuing on unconstrained inflationary deficit spending sprees, the RBA is reluctant to raise rates further, fearing the government will once again neutralise the rate hikes with even more ‘cost of living’ handouts and productivity-free wage rises which entrench the inflation spiral.
• Has this tarnished the RBA’s long-term record on inflation targeting?
• Here is an update on my 6 Feb 2026 article on the RBA’s long-term record on inflation.

• Today’s chart shows inflation rates for the main components of housing relative to CPI since 2000.
• Overall Housing cost inflation averaged 4.0% pa - ie 1.0% ABOVE CPI inflation. But there are big differences in the components of Housing.
• The main problem with housing inflation is GOVERNMENT. The highest inflation items are those directly or indirectly controlled by governments – utilities, property taxes, construction (State taxes, government supply restrictions, centralised wage rises), and rents (tax policies on rental housing investment, government supply constraints).
• Renters suffer the highest inflation as they tend to be lower income earners, spend more of their income on high inflation items (utilities, food), and have less spare cash to spend on lower inflation items (cars, gadgets).

• Today's chart shows Australian inflation since 2000 for the main categories of spending.
• The headline 'Consumer Price Index' inflation rate is a single number, averaged of a wide range of different goods & services with very different inflation rates.
• Some spending categories have inflation rates more than double CPI, while other items have actually fallen in price over the period (negative inflation).
• No household is 'average', so it is important to understand your own personal expense inflation rate in order to estimate how much CAPITAL you need per dollar of spending, and how much you can afford to SPEND given the level of CAPITAL, to ensure that your living standards are maintained and not eroded over time.
• The power of compounding magnifies even very small annual differ

• The national CPI inflation rate is averaged across all types of spenders and households, but different types of households experience different inflation rates due to different spending habits.
• Working households have the lowest overall inflation rate, BELOW overall national average CPI inflation.
• Next are Self-funded retirees, with higher average inflation than working households, but still LOWER than national CPI.
• Government age pensioners on average suffer inflation ABOVE national CPI inflation.
• At the top of the inflation pyramid with the HIGHEST average inflation are recipients of government welfare other than age pensioners.
• Welfare payments including pensions are indexed at the ‘Pensioner and Beneficiary Living Cost Index’ or CPI, whichever is HIGHER, which entrenches higher inflation for us all.

• Politicians of all flavours to this day still universally blame the 1970s inflation and stagflation on the oil shocks in 1973-4 and 1979.
• They also routinely cite rising energy prices following Russia’s invasion of Ukraine in 2022 as a main cause of the post-Covid stimulus inflation.
• The problem is that inflation was ALREADY high and rising well BEFORE each of these oil shocks.
• It is the same today, with inflation running above target even with oil prices falling over the prior year.
• Get ready for another barrage of lies blaming the war in Iran for inflation, rate hikes, and rising mortgage repayments.
• Once again diverting attention from the real causes: uncontrolled, largely ill-directed, productivity-sapping government deficit spending sprees, plus loose monetary policies (low nominal & real rates).

• Here’s my go-to chart on the BIG Picture on inflation over the past 150 years.
• Five BIG lessons:
• 1 - Inflation is global, because capital is global, and monetary theory/dogma/fads are global.
• 2 - Overall UPWARD trend in inflation over past 150 years as monetary systems moved from metal-backing, to exchange standards, then to unrestricted fiat paper money.
• 3 - Multi-decade inflation phases along the way as each monetary system is abandoned and replaced by the next.
• 4 - The big inflation spikes have been due to military buildups and war-time spending, same as past 2,000+ years.
• 5 - The recent 30-year golden era of declining/low inflation & interest rates, with high real returns for shares, bonds & property, is clearly over, as each of the drivers of disinflation have now ENDED and REVERSED, driving inflation a

My latest market shapshot

Global share markets were flat in July, ending the rebound since March after the start of the US/Iran war. Three reasons for the pause:

1: US/Iran war stalemate leaving fuel prices high, flowing through to broad inflation numbers, consumer confidence, spending.

2: US Fed’s new Chair Kevin Warsh sounding too soft on inflation.

3: Widening fears about the ai boom deflating. Four key developments in July.

Why I’m still relatively positive for share markets in the short term.

Plus the latest news (and a dozen charts) on Australian & global share markets, inflation, interest rates, currencies, commodities, Bitcoin. (+ 'I told you so' on SpaceX - sorry!)