America's inflation data has arrived. I can say that it came like a flower. We will look at the details now, inflation remained below expectations both monthly, annually, headline and core. Those who say America will enter stagflation, there will be both high inflation and recession, at least their high inflation wing seems to be broken. Trump and Powell are currently trying to help them a little for the recession wing. We will see the result of that, but it does not seem like there will be stagflation. In an environment where inflation is low and FED interest rates are very high, it will be quite easy for America to get out of the crisis. Many issues can be solved with a rapid interest rate cut by the FED. Of course, the uncertainties about the customs tariffs created by Trump also need to be resolved. Because its slowing effect on the economy is even greater than the interest rates. Because people are undecided. In other words, should I import goods from abroad or not? Should I buy another machine for my factory or not? Should I make an investment abroad or not? These are institutional decisions.

When you look at it from the consumer's perspective, I think I'll buy this right away this month, maybe the customs tariff is coming next month or vice versa, maybe there won't be a customs tariff, the product is expensive right now, it's cheaper. It pushes everyone into such indecision. In other words, they don't buy, they don't sell, etc. I think we are rapidly moving towards such an environment. On the other hand, there are layoffs in the public sector. Every person who becomes unemployed can contribute to the recession. These are the scary aspects of the situation, but at least we don't seem to have any problems on the inflation side. This also eliminates the risk of stagflation.

The data is really good. Inflation is 0.2% except for housing. I think this is the most important item. Because the inflation on the rent side, which we call housing, is measured by surveys. It constitutes 35% of total inflation. The survey is also conducted on homeowners, they are asked how much you would rent your house if you were to rent it. Of course, homeowners are the same all over the world. They want quite high prices. That's why this item is still resisting. There is a slight decrease in that too, but it hasn't decreased enough yet. Because it's a survey, not real data. When we look at real data, for example, Truflation is currently another inflation measurement institution, it measures it as 1.40. Because when you remove housing from the picture, the story changes all of a sudden.

The FED does not take food, housing and energy into account in inflation measurements. It says that their prices fluctuate very quickly, and it is right. For example, when we look at the food side, inflation was high last month. Because a disease infected chickens in America. There were many deaths and cullings in chickens. Egg production decreased and egg prices jumped incredibly, for example, it is a seasonal thing. It turned back this month and balanced. On the energy side, energy prices had increased a lot in the world in December and January. They started to fall rapidly. We are currently around 67 dollars in crude oil, they had gone up to 94. Of course, they are currently reflected positively in inflation, but they do not take this into account on the FED side. Because they say it is also volatile. Housing should also be excluded from the calculations because of what I just explained. Because the real numbers are not reflected there. Inflation appears to be 0.2. When you annualize 0.2, it is 2.4.

Now they say that the FED's tariffs are reflected in inflation. Yes, it may increase prices a little bit, but it does not mean that it is reflected in inflation. It means a one-time jump, the trend does not break. It jumps one month, stops again the second month, that increase. Because the main inflation triggering issue, the money printing issue, is very slow in America, they almost never print it. There is also a decrease in demand on the consumer side. How do we know this, most of the salary increases went and started to be allocated to savings. Something Americans would not normally do. Airline companies announced their balance sheets. Delta's balance sheet had come, it was a very bad balance sheet. We see that it is already reflected quickly on the transportation side, inflation in transportation is - 0.4. What does this mean? People are keeping more money aside, traveling less, traveling less. On the other hand, business travel etc. has probably slowed down in large institutions.

This is the situation, how should we look at the economy in such a situation now, how should we look at the markets. It is very difficult to predict the short-term movement of the market. I have nothing to say about that. Technically, a reaction increase may come from where we are right now. But a permanent increase is a bit difficult without solving these two important issues. What is it, will the FED finally see this? Will they see this real decrease in inflation or will they continue with the mindless statements Powell made last week. We think things are going well in the economy, we can wait a bit longer to reduce tariffs. The market is undecided on this issue. Right now, the market has started pricing in 3 interest rate cuts, 75 basis points. But it may not be enough, frankly, and the market is not sure. In other words, it is predicted that the FED may be more hard-headed.

I just watched an American economist, I like him a lot. In other words, he says the FED should actually lower interest rates in March, but we know they are not that smart. That is why we have a risk on the FED side. On top of that, Trump's tariffs continue to stir things up. They create uncertainty, people are unable to make decisions. These will be talked about for a long time. I think there are at least a few more months before these are resolved. In this context, making such an aggressive investment in the stock market right now does not seem like a smart thing, especially if you are thinking short-term. If you are thinking long-term, life is better in my opinion. Because many stocks that I really like have reached super-low prices. They may go down even further. In other words, companies that are strong, that you believe will grow, that you believe will grow even in a recession, I think they are not at bad prices. But do not make sudden, hasty moves.

The market will continue to price in this fear for a while. My favorite environments are mine, but my term is long. Since my term is long, I can be more resilient. If you are not resilient, the markets are a little more troubled, but the world has not ended. America is not going into stagflation, they can actually solve the recession issue quickly. They look at Trump's two simple statements. They say we have come to an end with the tariffs. Everything is clear, even if the tariffs are high, the market understands it and starts to recover. Also, if there comes a time when Mr. Powell starts to look a little forward from the past data, the markets can go somewhere else.

What is really important is the Fed meeting next week. The tone there is important, the market is not expecting a rate cut, the FED will cut rates. I don't think so either. Because this would be a sudden change. They can't let themselves accept this. But maybe a slightly more positive tone would be good. They may say that they are following inflation, it is going quite well. Let's see, in other words, the market is pricing in fear of what might happen, not the actual data. My prediction about what might happen is that these will continue to be discussed a lot in the short term, but in the long term, I think the path we are taking is the right one.

Okay, there is no inflation, but will the US enter a recession? In other words, we can't say there is a zero probability there anymore, to be honest. Because on the one hand Trump and on the other hand Powell are pushing very hard. On the other hand Elon Musk is laying off people. In fact Trump may even want this. I have explained before to lower interest rates rapidly. That is why the probability of a recession is not zero in my eyes. The probability of a recession in the upcoming period has slightly increased, I used to give a 0 percent probability, now I can give a 30 percent probability. But as you know, for 2.5 years I was saying no while everyone was saying there is a recession and a recession is certain. I still say there is no recession, but the probability has slightly increased. Because we are currently depending on what Powell and Trump will do. I cannot read what they will do. But if they start acting reasonably, the fears of a recession will dissipate very quickly.

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