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

To: pogohere who wrote (75199)	12/10/2006 6:41:47 PM
From: mishedlo	Read Replies (1) \| Respond to of 110194

why are prices rising now as opposed to not rising before (over meaningful periods)? There is a simple explanation for that. 1) Productivity and globalization masked the inflation in the 90's. Instead of prices of goods and services going up, stocks went up. Everyone thought it was the "greenspan productivity miracle" when what really happened is inflation (an expansion of money and credit) was masked by productivity and outsourcing. Stock prices reflected that inflation. 2) When Greenspan flooded the world with cheap rates in 2002-2005 home prices went up. Home prices show up in the CPI but the share price of CSCO does not. The key points here are 1) The Fed can print but it can not dictate where the money goes 2) Greenspan got away with a ton of inflation because of globalization and productivity masked it for a long time. Mish

To: pogohere who wrote (75199)	12/10/2006 7:18:58 PM
From: bart13	Read Replies (1) \| Respond to of 110194

I was hoping you would apply the idea that inflation/deflation was the movement of the price level over long periods of time (as opposed to short term fluctuations) to US economic history and experience. My understanding was that you could address the difference between long periods of price stability and periods of price instability by the use of your definition, or by some principle associated with the definition. My goal was a discussion that would provide a useful tool for economic analysis of the current situation. I.e., why are prices rising now as opposed to not rising before (over meaningful periods)? Here's some raw data in the area that may help: Sources are the Fed and NBER.