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Strategies & Market Trends : Bob Brinker, Moneytalk and Marketimer

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To: alleeox who wrote (1842)12/10/2007 11:08:54 AM
From: Kirk © of 2121
 
I've been following ECRI's FIG, Future Inflation Gauge, and it has been saying we are in a downtrend in inflation, but the negative growth rate of the FIG is getting close to zero and could turn up soon... A turn up in the FIG would mean the Fed may have to start worrying more about it soon, but Lakshman, who is a friend of mine and managing director at ECRI, says he thinks the Fed has some room with the low WLI and LOW FIG numbers now to cut rates.

With WLI falling off a cliff and very close to levels that predict a recession, the Fed needs to see some upturn in the WLI soon or we probably will have a recession.

Already, a decline in GDP growth from 4.9% to perhaps two quarters at an average of 1.4% will feel worse to many than a decline from 3.0% to -0.5% for two quarters, the definition of a recession.
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