To All,
An exceptional post from an exceptional poster.
While this particular post generates a lot of food for thought, and I consider it an excellent view applicable to the PM stocks LT,
Caution posting to
this gent is like word jousting with a hybrid of Shakespeare, the Big Blue computer and a world sized Thesaurus with a serious chip on its shoulder, ggg.
A match between the laughing god (ahhaha) and Slider would be definite pay per view material!
Message 16097084
The crap artists could care less what AG is saying. They speak to show how well they know how economics
works. They say one thing and vote another.
You say AG deserves respect. AG said that inflation isn't worrisome because corporations don't have pricing
power. They didn't have pricing power from 1973 until 1979 yet inflation roared onward, and during the '80s
corporations didn't have pricing power, but the CPI rose every year anyway. He's being disingenuous because he
knows he's dealing with a collection of clowns everywhere.
The fact is that inflation and money growth has him plenty concerned. They are the most worrisome things for the
central bank currently. He thinks he has to spread disinformation because otherwise imbeciles will compromise the
pretense of the FED by passing laws that give Congress power to set money growth. The thing is that this attitude
is equally as bad as what it fears.
Congress or the latrine orderly setting money policy would be no better or worse than what the FED does. Since
almost no one believes that, it is useless to recognize it. It's like asserting that the moon has craters during Galileo's
day.
Consider what's happening now. FED is almost daily engaged in pumping, yet recovery is paltry at best. At the
same time CPI isn't backing off. What happens when GNP growth starts up again? Unions will stop striking for
higher wages?
What AG knows and the rest of you better get down is that demands for compensation is the sole driver behind
inflation. As long as output, whatever that may mean, remains commensurate with demands for compensation then
there is no inflation. Since the early '60s we haven't had one year where that's been the case. The fault is ALL due
to activist prosperity ensuring FED policy.
During the '50s the monetary base didn't grow. The economy had to make do with the value the people created.
Then smart guys got in power and learned that the economy could be engineered to provide lasting prosperity. The
only problem is that it's false. The engineering creates a worse disaster. AG doesn't believe that and as long as he
doesn't, he deserves every bit of criticism that can be levied.
The problem is that the academics and everyone else have no idea where the problem lies. That guy Ransom
mentioned by frankw earlier on this thread is an example. He sounds real cool and right on, yet if he was tsar of
FED, he'd be doing the same thing AG does. No, he and AG deserve no respect. They deserve to be spit on.
No? Please tell me what FED will do when GNP starts recovering and a lot of people have to start catching up
with an inflated economy? Back off because corporations don't have "pricing power"? FED will have to at least
follow the market with their usual delay and raise rates, but not so fast as to harm the nascent recovery. That will
keep the inflation fires burning hot.
So with this contribution, I'm outta here,
ggg
Roebear |
