What does procyclical mean? Beats me! <g> Assume she was referring to one of equity value or inflation going up in sync with the other, as opposed to anticyclical.
1998 - 2000 was clearly a high growth/low inflation period. Agree in general, not sure why the period was referenced. Perhaps low inflation on an absolute scale, but climbing during that period from the various 1997-1998 financial crises (emerging markets, Russian meltdown, LTCM, etc).
We are now looking at : low growth/high inflation, or low growth/deflation IMO. Yes, but the combination of low interest rates and liquidity should produce more distinct inflation signs by fall, e.g. long bond, commodity prices, energy, labor wages, etc. That's as I understand the turnip thesis, leading to the Fed raising rates starting next year.
- Dway |
