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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (15323)	6/15/2004 11:22:54 PM
From: TheSlowLane	Read Replies (1) \| Respond to of 110194

Congrats, JW, I'm looking forward to giving it a listen. I also noticed that you've managed to help keep the froth at the egdes of the Mogambo's mouth... 321gold.com Mogambo sez... Jim Willie CB at FinancialSense.com wrote a scathing essay entitled "Tales of the Crack-Up Boom," and I suggest that you go there and read it for yourself so that you can get the full effect of his ill-disguised contempt. He is looking, as I look, at the inflation that is blazing away in the economy. He writes "Across the spectrum, from production to raw material to energy to intermediate products to food, costs are rising almost out of control. These items are not so much rising in price, as the US Dollar is declining in value." He notes that the government figures for inflation are, in my words, so ludicrous, so comically and blatantly false, that he says "One must qualify as an utter moron to accept the CPI at any number under 7%. My personal claim is simple. The CPI is three times what is publicly reported, no less." But he reports that "Back on Main Street, those who must get through the day with their families and homes, those who must operate an ongoing concern business, we see clearly through the false façade of farcical fortifications in financial markets." And I include this particular sentence of his because I just gotta stand and salute that long, luscious alliterative phrase. Although, looking at all those "f" words makes me think of a few choice "f" words of my own, and I grit my teeth trying not to have what I call a "Tourette's Syndrome episode (TSE)". The "crack-up boom" he refers to is what Ludwig Mises originally referred to in 1949, when he said "Once public opinion is convinced that the increase in the quantity of money will continue and never come to an end, and that consequently the prices of all commodities will not cease to rise, everybody becomes eager to buy as much as possible and restrict his cash holdings to minimum size If the credit expansion is not stopped in time, the boom turns to crack-up boom: the flight into real values begins, and the whole monetary system founders." Then he notes that "The Austrians warn of severe consequences in the end game of fiat money, identified by accelerated monetary expansion and currency competition." And then he chillingly reminds us what is meant by "severe consequences" and lays it out for that someone as dimwitted as The Mogambo can't miss it. "History is clear. No intentional inflation initiative has ever succeeded without horrible economic and financial market damage." He then goes on to list "Anecdotes and Tales" which are actual vignettes of real people and businesses who are being destroyed by inflation caused by Alan Greenspan and the central banks.