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To: Moominoid who wrote (125076)	10/15/2005 11:11:30 AM
From: skinowski	Read Replies (4) \| Respond to of 209892

I also cannot figure out some of EWI's targets. INDU at 400 is hard to imagine. Maybe if it is translated into some sort of an inflation-adjusted scheme, then maybe. Remember that only 3 years ago the index was under 7200, and nothing happened. All gone and forgotten... life went on. I came - independently - to the same conclusion as EWI with respect to deflation. Right now, there is a nearly total consensus out there that we are about to see an increase in inflation. Imo, the consensus is kind of thoughtless, and will be proven wrong. Why? Very simple. There is no pressure for wages to go up. Everyone thinks that the increase in the price of oil and some other commodities will be passed on to the consumer, and - voila! - we will be in the midst of a raging inflation. The problem is that after a few years of borrowing and spending, the consumer is perfectly positioned to... simply slow down. Don't know about you, but I can very easily get by for a couple of years without setting foot in a clothing store. (I may need a few pairs of socks along the way, that's true....). And, of course, again, there is not much of any pressure to increase wages. Recall that during the market collapse in 2000 - 2002 we were "fighting" DEflation.... And what's a better way to trigger a deflationary episode than to start "fighting" inflation at the wrong moment? Think about it. I expect some months from now everyone will be shocked - how obvious it all was....