tag:blogger.com,1999:blog-6616959642391988608.post3244427950474290229..comments2024-03-19T02:45:37.685-07:00Comments on Calafia Beach Pundit: Bonds are worrying about rising inflationScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-6616959642391988608.post-88379699156476014612011-04-05T13:46:41.546-07:002011-04-05T13:46:41.546-07:00Wages are usually the last thing to go up in a ris...Wages are usually the last thing to go up in a rising inflation environment. Inflation is devastating for the average person precisely because his/her wages are always lagging the rise in prices. Inflation is not a wage phenomenon, it's a monetary phenomenon.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-78500054387744562442011-04-05T13:39:32.256-07:002011-04-05T13:39:32.256-07:00Respectfully disagree and I believe the concern ab...Respectfully disagree and I believe the concern about QE2 is overblown...Question Don't we need a pick up in wage demands for inflation to take a hold. We have had 11 recessions since 1947 and all of them had a long term unemployed rate ( 27 weeks or longer)to labor force of 1% or lower....we are currently at 4%...<br />too much slack especially with regard to laborbroderohttps://www.blogger.com/profile/12296214283216386700noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-29661700332723698832011-04-05T13:22:06.269-07:002011-04-05T13:22:06.269-07:00The Federal Reserves track record is about as good...The Federal Reserves track record is about as good as the bond or equity markets. Ergo we are in deep trouble in the future...Public Libraryhttps://www.blogger.com/profile/00017383928897945054noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-61927172591406321672011-04-05T11:16:28.622-07:002011-04-05T11:16:28.622-07:00Scott:
Keep up the great work, and thanks for tole...Scott:<br />Keep up the great work, and thanks for tolerating a quibble from a layman.<br />Even when I have a quibble, I always rely on Calafia Beach for my main understanding of the economy and markets.Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-58311975188292148852011-04-05T10:49:40.958-07:002011-04-05T10:49:40.958-07:00That's a fair point. I would counter by arguin...That's a fair point. I would counter by arguing that a) the bond market does not always anticipate the future, and b) monetary policy acts on the economy and the markets with a "long and variable lag," as Milton Friedman taught us. I have noted before that the big drop in interest rates and inflation in late 2008 was the result of an involuntary tightening of monetary policy (the Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-83350630806980706332011-04-05T10:32:20.642-07:002011-04-05T10:32:20.642-07:00Scott Grannis: This is an interesting chart, but n...Scott Grannis: This is an interesting chart, but now I have a quibble.<br /><br />In a recent chart on commodities, you defined the 2000-2011 era as the "easy money era," in contrast with the tight money 1980-2000.<br /><br />Yet this chart shows TIPS yields going down in the 2000s. Down! And 10-year Treasuries too. Down!<br /><br />Milton Friedman said low interest rates are a sign of Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.com