For years now, the Federal Reserve has been chasing its 2% inflation target. Ryan Detrick, Chief Market Strategist at Carson Group, thinks it’s time investors stopped expecting it to get there — and started rethinking what higher inflation actually means for their money.
In an exclusive interview with Benzinga, Detrick made the case that the market is misreading the inflation story. Yes, prices are running hotter than the Fed wants. No, that doesn’t have to be bad news for stocks. In fact, he says, it might be the opposite.
The 2% Goal Is Slipping Out Of Reach
The Fed has long targeted 2% as its goal for annual inflation. But getting there has proven stubbornly difficult, and Detrick thinks the market is wrong to keep expecting it.
“What we’ve been saying for awhile, we’re in a 3% inflation world,” Detrick told Benzinga.
He pointed to the Personal Consumption Expenditures (PCE) Price Index, a popular Fed-watched gauge of consumer-price trends. Around 55% of its components are now climbing at more than 3% a year — up from about 45% a year ago.
“People hear that and they think immediately, oh my god , inflation’s higher. It has to be bad. That’s not true,” he said. History, he argued, doesn’t actually back up the idea that 2% inflation is normal: “Inflation has averaged around 4.5% throughout history, not the 2% that the Federal Reserve is targeting.”
The Iran War Made Things Worse — But It Didn’t Start The Trend
The conflict between the U.S.-Israel coalition and Iran, which broke out in late February 2026, has thrown a wrench into global energy markets. Iran’s restriction of traffic through the Strait of Hormuz — which normally carries about one-fifth of the world’s oil — has pushed U.S. gas prices above $4 a gallon and sent broader inflation expectations climbing.
But Detrick’s argument is that the war is merely amplifying a trend that was already in motion. “We were talking about the potential for higher inflation before this war started,” he said. “I mean, that was one of the things we were pointing out.”
If inflation was already drifting higher before the war, the “back to 2%” hope looks even more distant.
Why Higher Inflation Isn’t A Death Sentence For Stocks
Here’s where Detrick’s view gets genuinely contrarian.
“We own equities,” he told Benzinga. “I mean, by the way, equities usually do pretty darn good with higher inflation because they can increase margins.”
The logic: when prices are rising, companies can pass higher costs along to customers — sometimes raising their own prices by more than their costs go up. Detrick noted that profit margins for U.S. companies are currently moving higher. The S&P 500 has backed him up, hitting a record high of 7,165 on April 24 despite the geopolitical noise.
He also pointed out that a slow rise in inflation is easier for markets to absorb than a sudden spike. “Inflation [went] from around 2.5% to 9% in 2022,” he recalled. This time, “it’s just been kind of slow and steady, but it is higher and I think that’s going to make it harder for the Fed to cut [rates].”
What Carson Group Is Actually Buying
Detrick says Carson Group has built its portfolios around this view. The firm has shortened the duration of its bond holdings — meaning less exposure to losses if rates stay high — and added managed futures, gold, and “hard assets.”
“We’re about 68% equities, 32% other stuff,” Detrick said. “In the old days it was stocks and bonds. We have bonds. We have some gold, we have some managed futures, we have some hard assets. We have some real assets.”
That’s a meaningful departure from the classic 60/40 portfolio. On the equity side, Carson Group also holds some international stocks, but Detrick expects U.S. stocks to take the lead from here. “We like the US here and I think the US probably does a little bit better the second half of the year than the rest of the globe,” he said.
A Word On The Bears
Detrick doesn’t dismiss the analysts warning of recession or a bear market — he sees them as part of how markets work. “It’s a free market. There are sellers, there are buyers, you need bears to keep a bull market going,” he said.
His longer-term reassurance: the U.S. stock market has historically been higher three out of every four years on average, and there’s never been a 16-year stretch in which it’s been lower. The most obvious worry, he suggests, isn’t always the right one.
What baffles him is how investors react when the market does pull back. “The stock market is the only place where things go on sale, but everybody runs out of the store screaming,” he said.
Carson Group forecasted the S&P, which is tracked by the SPDR S&P 500 ETF Trust (NYSE:SPY), to grow 12% to 15% in 2026. Detrick said he's currently standing behind that forecast with nearly one third of the year complete.
Photo Courtesy Ryan Detrick
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