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To: Jim Willie CB who wrote (116201)	3/29/2002 7:39:59 AM
From: kech	Read Replies (1) \| Respond to of 152472

Actually I was thinking of late 1870's through 1890's a period of global growth, dropping prices due to excess capacity and low profitability due to excess capacity. For near future expect the same thing. Big money supply increases can't be considered in isolation. If the US and global economy continues to grow the money supply increases will be used to support real economic activity and not go into price increases. Inflation is not caused by price increases in selected commodities, it is an aggregate price level phenomenon. Price spikes in some commodities are just adjustments that a growing global economy can deal with. With huge increases in capacity, 1 billion Chinese producing like crazy, India getting a whiff of the market, Eastern Europe getting on board, capacity goes up and prices will go down. But profitability will also go down. IMHO