It’s useful to look at breakevens net of oil. We had two periods in the past 15 months where the 10-year breakeven inflation rate rose noticeably above the regression line with oil: right after Trump’s election, and during the past three weeks (see chart). But the recent deviation from the oil regression line is very small.

Where inflation expectations are concerned there’s no indication of a yield apocalypse and I continue to believe that the likely move in the 10-year yield will be quite modest.

What worries the stock market isn’t yields per se but the prospective erosion of profits.