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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: Box-By-The-Riviera™ who wrote (190176)9/1/2002 10:36:29 PM
From: GraceZ  Read Replies (1) of 436258
 
how can we see demand falling i.e. markets predicting declines... and yet the crb making new highs? in a stealth all year long that no one in the main press has written about? how can that be?

how can it be that supermarket prices have been rising even prior to the market bubble bursting? and continue to rise?


When you have money creation in the absence of loan demand (C&I loans have been steadily dropping for over a year) the money creation simply works to push up prices (by making the dollars worth less). We're used to seeing commodity prices rise because there are supply constraints or demand in excess of supply. But that's not what is happening now. Most commodity prices bottomed last year after years of falling in real dollar terms and have been rising even while worldwide demand fell. The only good news is that the Fed has been off the pump for the last two months. Our only hope is that they will stay out. If they don't, we risk a 70s redo.
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