Inventory to sales - this cannot be solved with Fed forward guidance

 

Take a look at the inventory to sales ratio and you will see that we have a way to go before returning to normal. If there are shortages, there will be price increases. Consumers will pay for immediacy, what they want today. We see this in the used car market. Less cars and higher prices. This problem will not go away if workers are not producing. 

Is this a transitory problem? Yes, but the transition may be longer than six months, so we can expect higher inflation into next year regardless of what the Fed says or does. Inventory increases can only come from production.