Jeremy Siegel, professor of finance at the University of Pennsylvania's Wharton School, said that 90% of the inflation had already gone and asserted that when the Federal Reserve gets it, there will be a massive surge in equities, according to his interaction with CNBC's 'Squawk Box' in November 2022.

What Happened: “It's taken way too long for the Fed to get it and they haven't got it yet that inflation is basically over; but they will. I think they are going to get it may be very late this year, early next year and I think as soon as they are going to get it, you are going to see a very big increase in equity prices,” Siegel told CNBC.

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Siegel said that he was shocked when St. Louis Fed President Jim Bullard said Fed rate hikes to date haven’t been big enough to cut inflation.

“I wonder what sort of data he is looking at. Tomorrow, we are going to get the monthly money supply. We have had a greatest six month decline in the money supply since World War 2. I expect another decline tomorrow. So, monetary conditions are still extraordinary tight,” he said.

Passing Costs: Talking about housing, he highlighted the fact that commodity costs are not going up any more.

“Forty per cent of the core index is this housing. So even when you take into account passing on, and I think it is true, many of them have passed on (the costs). But now the commodity costs are not going up any more. I mean there are some labour costs going up. But outside of that, basically, 90% of our inflation has gone,” he said.

This story was originally published on Nov. 22, 2022.

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