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

To: Mike Johnston who wrote (79021)	5/12/2008 3:34:52 PM
From: pogohere	Respond to of 116555

"Show me oil at $30, show me gold at 400 and euro back to parity and we'll talk." How do you use price rises and declines in your analytical framework, beside knowing that stuff is more expensive or cheaper? Do they tell you anything about the credit and monetary actions of the central banks? If so, what do you see the central banks doing with their monetary bases that affect prices in either direction? TIA

To: Mike Johnston who wrote (79021)	5/12/2008 4:29:06 PM
From: Sunny Jim	Read Replies (1) \| Respond to of 116555

As I see it, how can the drop in real estate prices be called deflation any more than when nobody called the rise in real estate prices inflation? We saw horrendous increases in real estate prices and all the while, the FED and administration said that there was no inflation (well anchored they called it). As real estate and credit contract there will be no more acknowledgement of deflation than there was of inflation when things were going wild. What they're going to have to acknowledge though is the fact that the economy was dependent on people's willingness to hawk their houses for spending and they can no longer do that. We should call it "suckflation" - that loud sound when everyone sucks in their belts and stops spending cause the house ATM got closed down.