Silicon Investor (SI) -- The First Internet Community

STOCKTALK

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.

Strategies & Market Trends : Commodities - The Coming Bull Market -- Ignore unavailable to you. Want to Upgrade?

To: craig crawford who wrote (1160)	3/19/2002 1:49:08 AM
From: craig crawford	Respond to of 1643

Do We Really Know that Oil Caused the Great Stagflation? A Monetary Alternative papers.nber.org Robert B. Barsky, Lutz Kilian NBER Working Paper No.w8389 Issued in July 2001 ---- Abstract ----- This paper argues that major oil price increases were not nearly as essential a part of the causal mechanism that generated the stagflation of the 1970s as is often thought. There is neither a theoretical presumption that oil supply shocks are stagflationary nor robust empirical evidence for this view. In contrast, we show that monetary expansions and contractions can generate stagflation of realistic magnitude even in the absence of supply shocks. Furthermore, monetary fluctuations help to explain the historical movements of the prices of oil and other commodities, including the surge in the prices of industrial commodities that preceded the 1973/74 oil price increase. Thus, they can account for the striking coincidence of major oil price increases and worsening stagflation.

To: craig crawford who wrote (1160)	3/19/2002 8:33:13 AM
From: Box-By-The-Riviera™	Read Replies (2) \| Respond to of 1643

thanks. some people are quite bullish on Asia, and not just for a trade. they mean bullish however, with a big exception, they still shy away from asian exporters... add that to what you said, you still have the question of pricing power.. if the recovery here is weak or non existent (the double dip) and growth of any kind is anemic vs. robust, where's the pricing power? short of the production cuts documented here in copper for example.. i.e. an artificial constraint on supply, how are higher prices going to be absorbed in the production chain and in the final finished product sale? is housing and military spending going to take up the slack where pricing power may fail in other (walmart) areas of the economy (economies)? there is a huge debate now about the level of military spending requested by the current leadership... it is massive, and yet in comparison to the commitment, it pales thus far to prior "wars".. we had 600k troops in viet nam, and the bombing tonnage dropped during that time was massive.... and yet the defense budget came no where near the current one. as to a return to building basic infrastructure in an island fortress approach... that may or may not be ideal. doesn't matter. how do you get there? who is going to absorb the differential that is required either in regulation, wage scales and other costs of doing business here vs. elsewhere? eventually perhaps it will all look more like trading blocks... a commerical nation being the sum of its block partners vs. nationality itself. i have more questions than answers like most people these days. i also think, thus far, that the rise in the crb broadly speaking, may be a false spring unless in some cases, it is a matter of too many dollars chasing too few goods/materials as money leaves imaginary assets for "real" ones. and yes then, perhaps stagflation fits the bill.