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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Steve Lokness who wrote (108710)	4/13/2009 8:27:46 PM
From: Mary Cluney	Respond to of 541062

<<<Inflation is the rise in the supply of money. You don't think that is occurring?>>> If wages and the cost of living are not going up - we do not have inflation. You are right in that it bears watching and the Fed, I believe, has tools to combat inflation. It is all in the timing. Early detection is the key. Reacting not too early and not too late. In any case, we have to find a way to invest in our economy. Roads, bridges, schools, and healthcare has to be upgraded. It is unlikely that private equity would enter those areas.

To: Steve Lokness who wrote (108710)	4/13/2009 11:16:09 PM
From: Dale Baker	Respond to of 541062

Inflation happens when you have too much money with strong demand and velocity chasing too few goods. At the moment, we have a huge deficit in demand and money velocity that government is trying to compensate for. The odds of serious inflation in the near future are just about zip. Further out, as demand and velocity return, the Fed will have to strip out a lot of the added liquidity they put in through their balance sheet, which they can do unilaterally.