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Comment by Found Zero
Entered on:

Retail sales up month over month? Uh huh. And when did we count cash for clunkers in? These guys are confirming Denninger--it's all pulled-forward demand.

As far as "market momentum" we already know most of the trading volume is by insider high-speed computers with an edge on the market.

What's fascinating to me was the guy saying “The fed was trying to spark inflation and get money moving again."

Well the Fed has been changing it's story on why they did what for some months now but sparking inflation wasn't stated. And if that was their intention (highly dubious), man, did they ever screw that pooch. The simpler answer is the question: cui bono?

This continual business of associating falling consumer prices with deflation is getting tedious. I still think we're blowing off excess inventory and capacity. True, businesses will cut margins down to whatever they can afford to stay in business, but once capacity reduces for a reduced market, we'll find a "support level" for consumer prices.

The deflationary implosion threat is real due to known factors: we've got junk on the books, our investment system is a joke, we're maxed out on credit and there ain't many eligible borrowers. We KNOW it's not a crisis of liquidity, these guys can invent money. We know that if they truly wanted to trigger inflation they'd spend stimulus into......drumroll.......you know what's coming.......

The "real economy".

This is the single biggest economic development of our time: the broad recognition of a "real economy" as opposed to Wall Street's and the Fed's. It's not exactly a new idea but it's broad adoption at this point represents a paradigm shift.

Not just a conservative thing, some heavy duty socialist economists are throwing the term around liberally (hardy har har).


Comment by Anonymous
Entered on:

 What did I tell you just yesterday?

http://www.freedomsphoenix.com/Article/044911-2009-02-02-today-another-day-to-watch.htm

But the mantra reciters just wanted to be hysterical.

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