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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (23028)	2/7/2005 11:03:21 AM
From: John Vosilla	Read Replies (2) \| Respond to of 116555

A question I ask is what is different this time compared to say 1972-3 that would make the eventual outcome different from the stagflationary 1970's. Back then commodities, home prices, rents, basic necessities and all wages appeared to all be in a relentless push upward on a national basis. This time rents and wages are seriously lagging and housing in coastal markets has become very unaffordable without financial engineering. Coupled with much greater debt levels of the public the risk this time is the collapse of the coastal housing bubble becoming a deflationary force perhaps placing a much lower ceiling on how high inflation and interest rates eventually do go spurring perhaps more positive developments in capital investment and the new economy.