Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: John McCarthy who wrote (77777)	4/16/2008 1:33:37 PM
From: stockfiend	Respond to of 116555

To quantify the effects of credit contraction on inflation one must quantify the current ratio of money/credit to the productive capacity of the economy and then see how much the contraction affects that ratio. For example, if credit/money supply is 4x what it should be but banks stop lending for one year, causing the ratio to drop to 2x, is that deflationary, esp. when you consider most of that excess money/credit was tied up into one asset class that wasn't an input into general inflation?