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

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To: bond_bubble who wrote (66549)7/20/2006 11:05:29 PM
From: mishedlo  Read Replies (3) of 110194
 
Do you think CPI inflation is GDP growth phenomenon OR is it monetary phenomenon?

I think CPI inflation is more or less meaningless
CPI was contained while stocks soared inthe 90's thru 2000 because that is where the money went.

Inflation (both monetary and CPI) is a lagging indicator actually.

Demand for stocks rose producing bubble #1
Demand for houses rose producing bubble #2

What pray tell is the next bubble?
If it does not produce rising jobs and wages it is all over.
I suggest it will produce neither jobs nor wages.

What the price of oil (gasoline) does is totally irrelevant.
What the price of natural gas (to heat your home) is irrelevent as well.

Actually I take that back, if they rise without a rise in wages, the effect is deflationary. There will be fewer jobs and less consumer discressionary money to spend.

The CPI is a government attempt that seems to have succeeded in getting people to look at mostly meaningless as well as manipulated data.

Mish
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