The housing bubble is over!

[Eugene]

You’re considering only variable costs, my friend. There are fixed costs too: store’s rent (or the opportunity cost if you own), insurance, etc. Anyways, thanks for the entertainment and going into the minutiae of burger selling. I could have said “$300 airfare” or “$0.75 pen”, etc.

I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.

Aha! You assume that the money supply is constant. Now your burger example starts to make more sense. But that’s an enormous IF you use. The metaphorical printing presses are working at full steam!

http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&s%5B1%5D%5Bid%5D=BASE&s%5B1%5D%5Brange%5D=5yrs

Full steam you say?

Haven’t you read the news this week? For instance, see:
http://www.csmonitor.com/2008/0313/p01s06-usec.html

The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?

[Diego Mamani]

I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home. (On the other hand, if the dollar appreciates rapidly against the gold/silver/euro, I’m ready to change my outlook, but that’s not the case for now.)

Your graph:
http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&s%5B1%5D%5Bid%5D=BASE&s%5B1%5D%5Brange%5D=5yrs

And your comment:
Full steam you say? The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?

That graph is of the monetary base!!! As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3. You need to consult an ECON 101 textbook so you can see the difference between these definitions of money.

How’s that printing? I explained before that I was using a metaphorical expression. Perhaps we need a dictionary too? Bsrsharma agreed with me that this $200B injection can be considered “printing” money in this broad sense. You don’t need to have more coins and dollar bills to fan inflation: the other, broader, definitions of money will do.

[Diego Mamani]

I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home. (On the other hand, if the dollar appreciates rapidly against the gold/silver/euro, I’m ready to change my outlook, but that’s not the case for now.)

Your graph:
http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&s%5B1%5D%5Bid%5D=BASE&s%5B1%5D%5Brange%5D=5yrs

And your comment:
Full steam you say? The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?

That graph is of the monetary base!!! As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3. You need to consult an ECON 101 textbook so you can see the difference between these definitions of money.

How’s that printing? I explained before that I was using a metaphorical expression. Perhaps we need a dictionary too? Bsrsharma agreed with me that this $200B injection can be considered “printing” money in this broad sense. You don’t need to have more coins and dollar bills to fan inflation: the other, broader, definitions of money will do.

[Diego Mamani]

I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home. (On the other hand, if the dollar appreciates rapidly against the gold/silver/euro, I’m ready to change my outlook, but that’s not the case for now.)

Your graph:
http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&s%5B1%5D%5Bid%5D=BASE&s%5B1%5D%5Brange%5D=5yrs

And your comment:
Full steam you say? The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?

That graph is of the monetary base!!! As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3. You need to consult an ECON 101 textbook so you can see the difference between these definitions of money.

How’s that printing? I explained before that I was using a metaphorical expression. Perhaps we need a dictionary too? Bsrsharma agreed with me that this $200B injection can be considered “printing” money in this broad sense. You don’t need to have more coins and dollar bills to fan inflation: the other, broader, definitions of money will do.

[Diego Mamani]

I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home. (On the other hand, if the dollar appreciates rapidly against the gold/silver/euro, I’m ready to change my outlook, but that’s not the case for now.)

Your graph:
http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&s%5B1%5D%5Bid%5D=BASE&s%5B1%5D%5Brange%5D=5yrs

And your comment:
Full steam you say? The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?

That graph is of the monetary base!!! As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3. You need to consult an ECON 101 textbook so you can see the difference between these definitions of money.

How’s that printing? I explained before that I was using a metaphorical expression. Perhaps we need a dictionary too? Bsrsharma agreed with me that this $200B injection can be considered “printing” money in this broad sense. You don’t need to have more coins and dollar bills to fan inflation: the other, broader, definitions of money will do.

[Diego Mamani]

I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home. (On the other hand, if the dollar appreciates rapidly against the gold/silver/euro, I’m ready to change my outlook, but that’s not the case for now.)

Your graph:
http://research.stlouisfed.org/fred2/fredgraph?chart_type=line&s%5B1%5D%5Bid%5D=BASE&s%5B1%5D%5Brange%5D=5yrs

And your comment:
Full steam you say? The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?

That graph is of the monetary base!!! As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3. You need to consult an ECON 101 textbook so you can see the difference between these definitions of money.

How’s that printing? I explained before that I was using a metaphorical expression. Perhaps we need a dictionary too? Bsrsharma agreed with me that this $200B injection can be considered “printing” money in this broad sense. You don’t need to have more coins and dollar bills to fan inflation: the other, broader, definitions of money will do.

[Eugene]

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home

I know that, and, as I said, contribution of all traded commodities to the retail price of a $3 burger is tiny. You can’t expect the burger to appreciate at the same rate as beef and flour.

As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3.

It is practically constant since last summer. In the mean time, euro went from 1.35 to 1.55 and gold went from 650 to 1000. Expanding monetary base is clearly not responsible for that.

The only thing the Fed can “print” is monetary base. M1 is more or less constant too. M2 and M3 involve a lot of double counting. For example, a big piece of M2 is actually commercial bonds and even mortgage-backed securities. They can grow or contract pretty much on their own, Fed, no Fed, gold standard, etc. M2 is up 4% since last summer, and half of that is “retail money market funds” (individual investors selling stocks and buying bonds).

[Eugene]

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home

I know that, and, as I said, contribution of all traded commodities to the retail price of a $3 burger is tiny. You can’t expect the burger to appreciate at the same rate as beef and flour.

As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3.

It is practically constant since last summer. In the mean time, euro went from 1.35 to 1.55 and gold went from 650 to 1000. Expanding monetary base is clearly not responsible for that.

The only thing the Fed can “print” is monetary base. M1 is more or less constant too. M2 and M3 involve a lot of double counting. For example, a big piece of M2 is actually commercial bonds and even mortgage-backed securities. They can grow or contract pretty much on their own, Fed, no Fed, gold standard, etc. M2 is up 4% since last summer, and half of that is “retail money market funds” (individual investors selling stocks and buying bonds).

[Eugene]

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home

I know that, and, as I said, contribution of all traded commodities to the retail price of a $3 burger is tiny. You can’t expect the burger to appreciate at the same rate as beef and flour.

As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3.

It is practically constant since last summer. In the mean time, euro went from 1.35 to 1.55 and gold went from 650 to 1000. Expanding monetary base is clearly not responsible for that.

The only thing the Fed can “print” is monetary base. M1 is more or less constant too. M2 and M3 involve a lot of double counting. For example, a big piece of M2 is actually commercial bonds and even mortgage-backed securities. They can grow or contract pretty much on their own, Fed, no Fed, gold standard, etc. M2 is up 4% since last summer, and half of that is “retail money market funds” (individual investors selling stocks and buying bonds).

[Eugene]

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home

I know that, and, as I said, contribution of all traded commodities to the retail price of a $3 burger is tiny. You can’t expect the burger to appreciate at the same rate as beef and flour.

As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3.

It is practically constant since last summer. In the mean time, euro went from 1.35 to 1.55 and gold went from 650 to 1000. Expanding monetary base is clearly not responsible for that.

The only thing the Fed can “print” is monetary base. M1 is more or less constant too. M2 and M3 involve a lot of double counting. For example, a big piece of M2 is actually commercial bonds and even mortgage-backed securities. They can grow or contract pretty much on their own, Fed, no Fed, gold standard, etc. M2 is up 4% since last summer, and half of that is “retail money market funds” (individual investors selling stocks and buying bonds).

[Eugene]

Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home

I know that, and, as I said, contribution of all traded commodities to the retail price of a $3 burger is tiny. You can’t expect the burger to appreciate at the same rate as beef and flour.

As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3.

It is practically constant since last summer. In the mean time, euro went from 1.35 to 1.55 and gold went from 650 to 1000. Expanding monetary base is clearly not responsible for that.

The only thing the Fed can “print” is monetary base. M1 is more or less constant too. M2 and M3 involve a lot of double counting. For example, a big piece of M2 is actually commercial bonds and even mortgage-backed securities. They can grow or contract pretty much on their own, Fed, no Fed, gold standard, etc. M2 is up 4% since last summer, and half of that is “retail money market funds” (individual investors selling stocks and buying bonds).

[bobby]

your argument is well and good but you must consider the ability of the buyers to pay. If buyers can’t pay (or can’t get loan), there’s less demand. Supply is constant ergo prices decrease.

[bobby]

your argument is well and good but you must consider the ability of the buyers to pay. If buyers can’t pay (or can’t get loan), there’s less demand. Supply is constant ergo prices decrease.

[bobby]

your argument is well and good but you must consider the ability of the buyers to pay. If buyers can’t pay (or can’t get loan), there’s less demand. Supply is constant ergo prices decrease.

[bobby]

your argument is well and good but you must consider the ability of the buyers to pay. If buyers can’t pay (or can’t get loan), there’s less demand. Supply is constant ergo prices decrease.

[Author]

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