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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: BGR who wrote (48371)2/23/1999 9:43:00 AM
From: Mike M2  Read Replies (1) | Respond to of 132070
 
BGR, other than asset inflation -ho ho ho . Historicly ,Asset inflation is associated with greater economic damage than product inflation because central banks tend to let asset inflation get out of control. Look at the 20's in the US and the 80s in Japan. In the first 3 Qs of 1998 in the US for each dollar added to national income $2.92 was added to debt and for each dollar of GDP growth $ 2.66 of debt was added. What the monetarists call liquidity is actually excesses in credit and debt. How long can debt grow faster than incomes or economic activity? anyone see a problem here -g-. Mike



To: BGR who wrote (48371)2/23/1999 10:03:00 AM
From: yard_man  Read Replies (1) | Respond to of 132070
 
You miss the more important points about credit expansion, IMO.

The huge cycles of boom and bust have been exacerbated greatly by the actions of central bankers, allowing credit to grow much too fast ... talking about how bad things were wherever you came from and how good they are now is just indicative of how bad it is when such natural cycles are greatly accentuated by inept central bankers.


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