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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: mishedlo who wrote (5739)	1/22/2004 9:10:41 AM
From: russwinter	Read Replies (3) of 110194

<That is exactly where Russ's argument goes to hell.> Couldn't disagree more. The job of a good CB, is to assure price stability. They can't pick and choose their inflation. Nor can they export it back to places like China and expect to get away with it. A component of the inflation I've been describing is supply related. Even so the supply problems arise because the market is so distorted now. But a large measure of current input cost inflation is demand driven (and weak USD driven), and results from the Fed leading the way with easy money. Message 19705645 And now it has a speculative, hoarding component, again caused by low rates. Low rates encourage commodity and anti-USD currency carry trades. Message 19706511 <WTF would 8% do?> If it gets bad enough, 8% might be applied, but that's not what I'm calling for today. If I were the CB, I'd be heading for 3% FF fairly quickly though. <there is indeed inflation in SOME things.. Some? I'd say just about every input item I can locate. It's getting pernicious.

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