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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?


To: Crimson Ghost who wrote (75418)4/18/2001 11:11:17 PM
From: Doug  Read Replies (1) | Respond to of 99985
 
G.S.C: The economy has always been between the threat of stagflation and deflation. Stagflation is easily controlled by hiking interest rates ad nauseam till you force a recession and curtail demand.

Controlling deflation when the interest rate is already close to the rate of inflation is extremely difficult. I believe this is the threat that A.G sees and one which I consider more real in the short term.

Japan has shown that there are few tools to handle an economy in deflation mode.