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

To: Elroy Jetson who wrote (101218)	2/12/2009 1:49:31 PM
From: Tommaso	5 Recommendations Read Replies (1) \| Respond to of 110194

Paul Volcker stopped the inflation of the 1970-1980 period by applying Milton Friedman's monetarism. To dismiss one the great economists of all time, a Nobel Prize winner among many other things, as the author of "claptrap" betrays a truly minuscule intellect.

To: Elroy Jetson who wrote (101218)	2/12/2009 3:46:05 PM
From: THE ANT	Read Replies (1) \| Respond to of 110194

Asset prices went up during the 20 years prior to the bubble burst due to credit going from 120% GDP to 380% GDP.This was not true inflation but a real rise in the value of assets if there had been a paradigm shift and credit would stay at this lofty ratio of GDP on a permanent basis.When the financial glue holding credit at this level was found to not be waterproof(mathematical models and insurance models failed ie Lehman)everyone out in their financial boats screamed and headed for shore as their boats broke apart.You can inflate but this will inflate both assets and wages and not assets to wages like the credit bubble did.As the government can not create nor maintain a 380% credit/GDP bubble there is nothing to do but take the pain