O.T. - my "rant" on a WSJ forum about the "wisdom" of the Federal Reserve.
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#3 of 3: Jon Koplik Wed 19 May '99 (09:24 AM)
(Cannot resist "posting" my thoughts on how clueless I think the FOMC is right now).
Gold is at or near a 20 year low, M2 and M3 are now down to roughly 5% growth rates, the U.S. Dollar is strong versus other key currencies, the Employment Cost Index (just released) was the lowest since they began that data series (back in 1982), many commodity indices are at or near 20 to 25 year lows, spot price of steel scrap (a favorite Greenspan indicator) at or near 20 year lows, mortgage refinancing applications down sharply (implying further slowing of money supply growth), Housing Starts (which apparently have a 100% accuracy rate for predicting economic slowdowns) now down 3 months in a row (and housing permits also) (both series down a meaningful magnitude), capacity utilization rate at a level typically seen during recessions, Internet related new businesses reducing the costs and sales prices of many items and services out there, (telecommunications advances also doing the same thing), "Supplier" (or "Vendor") Delivery Index (within the National Assoc. of Purchasing Managers Report) still indicating no problem at all obtaining goods quickly, and last -- (something I personally do not understand 100%) the velocity of money has been slowing significantly lately.
Well, they KNOW we should be worrying about inflation.
I predict they will turn out to be as wrong on this as they were
during the beginning of the whole 1990 - 1992 period.
Jon Koplik. |
