So a 100 bp “overage” in the T-Bill rate is the culprit of higher inflation? I think businesses are just raising prices, because they can now.

If T-Bill revenue is about $300B per year based on $6T outstanding at 5%, and foreigners own 30%, that’s about $200B of income here in the U.S.  Berkshire Hathaway alone takes about $9B of that with other major corps like Apple, Amazon and Alphabet reaping at least another $15B.  But for the sake of argument, let’s say a 100 bps difference amounts to about $40B annually in income to contribute to inflation in services. Seems like a drop in the bucket on a $27T economy.

I challenge the notion that people enjoying monthly T-Bill yield are driving inflation in services.  My local plumbers and electricians are raising their rates simply because they can.  They’re saying, “Hey, I provide a real service.  Good luck finding someone else to install your new toilet.” 

The old timers that dominated the profession 10 years ago are mostly retired, and it’s a younger generation that want to be compensated more.  They’ve got families, and they’re trying to leap frog into high asset prices. I’d extrapolate this out to every necessary services profession right now.

The inflation genie was let out of the bottle, so it’s tough to put back in.