Hi Mike, <<posting Gene Epstein's column. He's on the money as usual, imho>> no doubt, and you understood what he said. I failed miserably. I thought he was explaining why one model was so much better than another model, and why the stock market is undervalued relative to expectations.
<<1) Why there is no inflation, despite Uncle Al's diligent pumping>>
There was and is, as money supply expanded faster than Economy, even as Economy is supposedly more efficient, but not so with capital (lost) and debt required.
There was and is, first in the form of Bubble Le Premier Chapitre (blame the spelling on my wife, and the rest on my keyboard), and then in housing, twin fiscal and trade deficit, all resulting in one and half hamburgers requiring a weekly deposit of USD 1 mm. If that is not inflation, what is?
Oh, sorry, you meant the CPI?! That is New Ec accounting, less the core kernel of truth, to aid the equally fictional balancing of a budget that is no more, and keep TIPS tops.
<<2) Why no economic collapse, despite the bears' dearly beloved debt overhang (aka mountain, iceberg, etc.)>>
Give it time, especially when anticipating, as few did in November 1999.
You are of course not disposed to be convinced, and so we will have to wait the three months, when hot air is no longer sufficient to keep the balloon aloft.
Chugs, Jay |
