Inflation – Has it arrived?

[Rich Toscano]

The US in the 70s, for generic stagflation. (BTW if high inflation and low growth/employment never happen together, why is there a word to describe them happening together?)

Or, for an example of an inflation driven by a loss of confidence in the sovereign debt and currency, Iceland in 08-09.

I don’t know how to make an example gallop so I think I’m good.

[CA renter]

[quote=poorgradstudent]2010 has seen inflation in the range of 1-3%. I doubt inflation will be a serious problem until the job market recovers more, and that looks at least a year away.

With wages flat/deflationary, there’s just not a lot of upward demand pressure to drive inflation right now.[/quote]

You’re looking at CPI. Look at what’s happened to asset prices instead. Consider the fact that we’re supposed to be in “The Worst Recession Since the Great Depression.”. Mind you, flat prices during a recession/depression also qualifies as “inflation” in my mind — prices are higher than what fundamentals would dictate. That being said, there is nothing “flat” about asset prices these past ~18 months. Inflation is all around us, in a big way.

[CA renter]

[quote=poorgradstudent]2010 has seen inflation in the range of 1-3%. I doubt inflation will be a serious problem until the job market recovers more, and that looks at least a year away.

With wages flat/deflationary, there’s just not a lot of upward demand pressure to drive inflation right now.[/quote]

You’re looking at CPI. Look at what’s happened to asset prices instead. Consider the fact that we’re supposed to be in “The Worst Recession Since the Great Depression.”. Mind you, flat prices during a recession/depression also qualifies as “inflation” in my mind — prices are higher than what fundamentals would dictate. That being said, there is nothing “flat” about asset prices these past ~18 months. Inflation is all around us, in a big way.

[CA renter]

[quote=poorgradstudent]2010 has seen inflation in the range of 1-3%. I doubt inflation will be a serious problem until the job market recovers more, and that looks at least a year away.

With wages flat/deflationary, there’s just not a lot of upward demand pressure to drive inflation right now.[/quote]

You’re looking at CPI. Look at what’s happened to asset prices instead. Consider the fact that we’re supposed to be in “The Worst Recession Since the Great Depression.”. Mind you, flat prices during a recession/depression also qualifies as “inflation” in my mind — prices are higher than what fundamentals would dictate. That being said, there is nothing “flat” about asset prices these past ~18 months. Inflation is all around us, in a big way.

[CA renter]

[quote=poorgradstudent]2010 has seen inflation in the range of 1-3%. I doubt inflation will be a serious problem until the job market recovers more, and that looks at least a year away.

With wages flat/deflationary, there’s just not a lot of upward demand pressure to drive inflation right now.[/quote]

You’re looking at CPI. Look at what’s happened to asset prices instead. Consider the fact that we’re supposed to be in “The Worst Recession Since the Great Depression.”. Mind you, flat prices during a recession/depression also qualifies as “inflation” in my mind — prices are higher than what fundamentals would dictate. That being said, there is nothing “flat” about asset prices these past ~18 months. Inflation is all around us, in a big way.

[CA renter]

[quote=poorgradstudent]2010 has seen inflation in the range of 1-3%. I doubt inflation will be a serious problem until the job market recovers more, and that looks at least a year away.

With wages flat/deflationary, there’s just not a lot of upward demand pressure to drive inflation right now.[/quote]

You’re looking at CPI. Look at what’s happened to asset prices instead. Consider the fact that we’re supposed to be in “The Worst Recession Since the Great Depression.”. Mind you, flat prices during a recession/depression also qualifies as “inflation” in my mind — prices are higher than what fundamentals would dictate. That being said, there is nothing “flat” about asset prices these past ~18 months. Inflation is all around us, in a big way.

[pjwal]

No one is concerned about inflation, which is why it’s a great time to get TIPS (Treasury Inflation Protected Securities) at a good price at auction. You should keep your overall portfolio to 7-17% of this anyway as the hedge against inflation, imho.

[pjwal]

No one is concerned about inflation, which is why it’s a great time to get TIPS (Treasury Inflation Protected Securities) at a good price at auction. You should keep your overall portfolio to 7-17% of this anyway as the hedge against inflation, imho.

[pjwal]

No one is concerned about inflation, which is why it’s a great time to get TIPS (Treasury Inflation Protected Securities) at a good price at auction. You should keep your overall portfolio to 7-17% of this anyway as the hedge against inflation, imho.

[pjwal]

No one is concerned about inflation, which is why it’s a great time to get TIPS (Treasury Inflation Protected Securities) at a good price at auction. You should keep your overall portfolio to 7-17% of this anyway as the hedge against inflation, imho.

[pjwal]

No one is concerned about inflation, which is why it’s a great time to get TIPS (Treasury Inflation Protected Securities) at a good price at auction. You should keep your overall portfolio to 7-17% of this anyway as the hedge against inflation, imho.

[equalizer]

[quote=Rich Toscano]The US in the 70s, for generic stagflation. (BTW if high inflation and low growth/employment never happen together, why is there a word to describe them happening together?)

Or, for an example of an inflation driven by a loss of confidence in the sovereign debt and currency, Iceland in 08-09.

I don’t know how to make an example gallop so I think I’m good.[/quote]
Whatever started the 70’s inflation (oil embargoes, wage inflation), the economic policy mistakes kept inflation high. Today, Inflation would remedy/reduce the debt problem, so Fed will likely hope for and adopt strategies to increase inflation.

Rich: Are you gonna wear more gold chains than Mr. T at the next (Halloween) meet-up?

“And, as has been stressed by a number of scholars, a belief in a permanent trade-off between inflation and unemployment briefly held sway. These views led to highly expansionary monetary and fiscal policies, and inflation and booming real growth resulted….

The Samuelson-Solow permanent trade-off view was rejected at the start of the Nixon administration. However, it was replaced by another flawed model: first by a natural rate framework with a very low natural rate, then by a natural rate framework with an extreme insensitivity of inflation to slack. It was this succession of misguided models that gave rise to repeated policy mistakes and persistent inflation in this period.”

http://economistsview.typepad.com/economistsview/2007/04/what_caused_the.html

[equalizer]

[quote=Rich Toscano]The US in the 70s, for generic stagflation. (BTW if high inflation and low growth/employment never happen together, why is there a word to describe them happening together?)

Or, for an example of an inflation driven by a loss of confidence in the sovereign debt and currency, Iceland in 08-09.

I don’t know how to make an example gallop so I think I’m good.[/quote]
Whatever started the 70’s inflation (oil embargoes, wage inflation), the economic policy mistakes kept inflation high. Today, Inflation would remedy/reduce the debt problem, so Fed will likely hope for and adopt strategies to increase inflation.

Rich: Are you gonna wear more gold chains than Mr. T at the next (Halloween) meet-up?

“And, as has been stressed by a number of scholars, a belief in a permanent trade-off between inflation and unemployment briefly held sway. These views led to highly expansionary monetary and fiscal policies, and inflation and booming real growth resulted….

The Samuelson-Solow permanent trade-off view was rejected at the start of the Nixon administration. However, it was replaced by another flawed model: first by a natural rate framework with a very low natural rate, then by a natural rate framework with an extreme insensitivity of inflation to slack. It was this succession of misguided models that gave rise to repeated policy mistakes and persistent inflation in this period.”

http://economistsview.typepad.com/economistsview/2007/04/what_caused_the.html

[equalizer]

[quote=Rich Toscano]The US in the 70s, for generic stagflation. (BTW if high inflation and low growth/employment never happen together, why is there a word to describe them happening together?)

Or, for an example of an inflation driven by a loss of confidence in the sovereign debt and currency, Iceland in 08-09.

I don’t know how to make an example gallop so I think I’m good.[/quote]
Whatever started the 70’s inflation (oil embargoes, wage inflation), the economic policy mistakes kept inflation high. Today, Inflation would remedy/reduce the debt problem, so Fed will likely hope for and adopt strategies to increase inflation.

Rich: Are you gonna wear more gold chains than Mr. T at the next (Halloween) meet-up?

“And, as has been stressed by a number of scholars, a belief in a permanent trade-off between inflation and unemployment briefly held sway. These views led to highly expansionary monetary and fiscal policies, and inflation and booming real growth resulted….

The Samuelson-Solow permanent trade-off view was rejected at the start of the Nixon administration. However, it was replaced by another flawed model: first by a natural rate framework with a very low natural rate, then by a natural rate framework with an extreme insensitivity of inflation to slack. It was this succession of misguided models that gave rise to repeated policy mistakes and persistent inflation in this period.”

http://economistsview.typepad.com/economistsview/2007/04/what_caused_the.html

[equalizer]

[quote=Rich Toscano]The US in the 70s, for generic stagflation. (BTW if high inflation and low growth/employment never happen together, why is there a word to describe them happening together?)

Or, for an example of an inflation driven by a loss of confidence in the sovereign debt and currency, Iceland in 08-09.

I don’t know how to make an example gallop so I think I’m good.[/quote]
Whatever started the 70’s inflation (oil embargoes, wage inflation), the economic policy mistakes kept inflation high. Today, Inflation would remedy/reduce the debt problem, so Fed will likely hope for and adopt strategies to increase inflation.

Rich: Are you gonna wear more gold chains than Mr. T at the next (Halloween) meet-up?

“And, as has been stressed by a number of scholars, a belief in a permanent trade-off between inflation and unemployment briefly held sway. These views led to highly expansionary monetary and fiscal policies, and inflation and booming real growth resulted….

The Samuelson-Solow permanent trade-off view was rejected at the start of the Nixon administration. However, it was replaced by another flawed model: first by a natural rate framework with a very low natural rate, then by a natural rate framework with an extreme insensitivity of inflation to slack. It was this succession of misguided models that gave rise to repeated policy mistakes and persistent inflation in this period.”

http://economistsview.typepad.com/economistsview/2007/04/what_caused_the.html

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