Monetary Madness: Global Margin Call Underway [View article]
Some good comments today: 1. User 257960: Inflation is driven by money supply plus credit. If credit is way down, money supply can be way up. Lets just hope that Bernanke knows when to reverse course. 2. Alex S: We are a huge debtor, and we control the world currency. We will prefer inflation. A key insight. 3. All indicators like the Great Depression? Very bad history. Farm incomes are great; unemployment is modest by historical standards; there have been few bank failures. We have been fixing the bubble in housing prices and the effects of lousy discipline in the financial system; the stock market is down - painfully, but not extraordinarily. It will be painful, but it is just demagogery to say it is the Great Depression.
It would seem from the strength of the dollar and low long term interest rates that the markets believe that Bernanke will get it right. If you believe otherwise, short the dollar and long term bonds.
Monetary Madness: Global Margin Call Underway [View article]
1. User 257960: Inflation is driven by money supply plus credit. If credit is way down, money supply can be way up. Lets just hope that Bernanke knows when to reverse course.
2. Alex S: We are a huge debtor, and we control the world currency. We will prefer inflation. A key insight.
3. All indicators like the Great Depression? Very bad history. Farm incomes are great; unemployment is modest by historical standards; there have been few bank failures. We have been fixing the bubble in housing prices and the effects of lousy discipline in the financial system; the stock market is down - painfully, but not extraordinarily. It will be painful, but it is just demagogery to say it is the Great Depression.
It would seem from the strength of the dollar and low long term interest rates that the markets believe that Bernanke will get it right. If you believe otherwise, short the dollar and long term bonds.