SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Politics : Ask Michael Burke
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Knighty Tin who wrote (41148)12/28/1998 1:34:00 PM
From: Jess Beltz  Read Replies (4) of 132070
 
Michael, I agree that asset prices are "inflated" relative to historical standards. About the hypothesis that the Fed or other government agencies is rigging the numbers to create the illusion that inflation is low when in fact it is higher than reported only has substance if (1) the true numbers are really substantially higher than those given, and (2) the market reacts to the true numbers. I am not sure that either of those things is happening right now, nor will in the near future. The arguments about the correct formulae for the CPI and PPI have been around for a long time without resolution. To me, the key right now for maintaining the low inflation "regime" (and the impact of that on inflated asset prices) has to do with the cost of energy. Without a rise in energy prices, I see (a) inflation dead in the water, and (b) overall asset prices at levels comparable to those existing right now. I still see the sector rotation out of blue-chips in the next two fiscal quarters, and the best tech stocks stand to be the recipients of that rotation. There is no hint of rising energy prices on the horizon. The Fed will only start pulling in the reigns on s-t rates when Alan catches a whiff of inflation. I don't see that coming until (1) the recovery in Asia stimulates an increase in the demand for oil, which (2) translates into higher energy prices.

jess.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News