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

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To: mishedlo who wrote (10853)3/26/2004 3:24:13 PM
From: Jim Willie CB  Read Replies (2) of 110194
 
reflation with globalization, nasty combo, eh MishMan ???

reflation lifts costs
it squeezes profit margins and household budgets alike
so companies invest and spend less, households spend less
end result is deflation

globalization takes jobs to foreign lands
workers lose jobs and income
end result is deflation

few seem to realize in WashDC
but globalization levels the wage playing field
the USA has years to go before wages settle down at a level perhaps 20-40% lower than today's

does the Fed realize their policies of monetary expansion are resulting in economic deflation ???
interesting paradox, eh MishMan?

/ jim
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