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

To: mishedlo who wrote (50465)	1/20/2006 2:54:59 PM
From: GST	Respond to of 110194

LOL -- of course inflation is price inflation and deflation is price deflation!!! Come out from under your monetary rock :) Money supply is a factor, but by absolutely no means can it be considered apart from other as apects of supply and demand. Geesh -- if you are going to make up your own reality and language at least let us know so we don't need to wonder why you are so disconnected from the mainstream reality and talk in circles! In your strange little world, holding money supply constant would wipe out all possible aspects of inflation and deflation (that does not even make sense from an anal adherence to a narrow monetary prespective) -- that really is a moment of humor for a boring Friday afternoon. Perhaps there are a handful of 19th century types around here who, like you, think that money supply and inflation/deflation are exactly the same thing, but most people view it from the point of view of prices in the real world in the 21st century. We are NOT on a gold standard and all currencies are fiat currencies -- get over it! The quanitity of goods for sale and the terms of trade are NOT fixed and there IS international trade. The rest of the world is taking about PRICE inflation and deflation, not isolated attention on money supply (or US money supply) as the only consideration :)

To: mishedlo who wrote (50465)	1/20/2006 2:58:41 PM
From: Tommaso	Respond to of 110194

>>>Inflation is an increase or decrease in money. Period.<<< Mish, at some point the Treasury may have so much trouble auctioning off bonds that the Fed will have to step in as a buyer of last resort. At that point you will see how much the money supply increases as the Fed creates bank balances to pay for its purchases. The United States is just lucky that it can do that; smaller countries whose currency is not the world medium of exchange have no recourse but to default on their debt. The result of monetizing of the debt will be a depreciation of the dollar's value against all sorts of goods, commodities, and services. Most people call the consequent rising of prices inflation.