Erick Tippett

Return of the Bond Market Vigilantes?

A side note: the term "Fiat" means so be it, our present monetary
system is exactly that, "Fiat"!

EDT
Chicago, Illinois

Return of the Bond Market Vigilantes?

It is gratifying to see how many more people are now beginning to
see how the bottomless pit of toxic assets will soak up whatever
amount of paper the Federal Reserve Board prints up and the
government throws around to 'stimulate' the economy. It seems
as if the lessons of the past mean nothing and knowledge of the
principles of sound economics must always play second fiddle
to winning popularity contests and selling out on ones stated ideas
and ideals in order to be elected or influential in government service(Alan Greenspan was once a strong proponent of the gold standard and a student of Ayn Rand and the Austrian School of Economics!)

Such a pity that a modern democracy has neither majority voting
public nor elected officials who know any thing about how sound
economic principles preserve capital, increase productive expan-
sion (creates jobs and subsequent wealth), and eschews waste
of financial reserves and encourages savings. Communist China
is doing a much better job in the aforementioned areas than the
left now right then left again United States. Apparently the idea of independent officials in American government frightens a lot of
people as they seem to prefer the "devil" they know, the one party Republicrat system. So be it!

EDT
Chicago, Illinois

Gary Shilling Continues to See Deflation on the Horizon

Many people easily are wearied by this endless deflation-inflation
debate! If one chooses to limit the definition of these two terms to
the classical ones according to Webster ("Inflation is an increase
in the volume of money and credit relative to available goods."......
"Deflation is a contraction in the volume of money and credit relative
to availble goods.") inflation is certainly on the horizon as the FED's balance sheet has skyrocked since last fall. However, all this deleveraging (because of toxic debt and the hesitancy of banks to lend as credit remains basically unavailable to all but a few) has
created a kind of "deflation" not in the classical sense of the word and has been in existence for some time now. All the printing presses and all the kings men can never put humpty-dumpty back together again, unless the bottomless pit can be filled. But don't hold your breath; for that is not going to happen anytime soon!

EDT
Chicago, Illinois