Hi csl,
Sounds like you are doing some wonderfully productive things in your life. Congratulations, Farmer. Good day, Teacher.
Onto inflation.
That's a curious way of arguing.
If Ron Paul hadn't imagined inflation was due, would you have thought it was invisibly present?
In the csl alternate universe, house prices are in a bubble and foreclosures are a mirage?
In a csl alternate universe, wages are rising fast?
In a csl alternate universe, the rise in consumer goods prices is being fuelled by massive demand from a broad swathe of consumers desperate to spend, spend, spend?
In the csl alternate universe, long-term interest rates are really high reflecting an expectation of inflation in the marketplace?
Remarkably, the inflation numbers contradict this view. They suggest that house prices are at best stable, but still under pressure, wages are stagnant and there's little demand for goods. Low long-term interest rates reflect the fact that investors think Treasuries are a robust store of value.
The only counter-acting force which I can see which might drive inflation is in the commodities markets, which are affected by global demand (and which are driven in part by energy prices). But the EU is headed into a recession and China's growth is slowing if it hasn't already popped. Energy prices seem to be reducing finally. So I don't see it there either.
Where's it?
| 