While it's perhaps desirable for some businesses to have a little more pricing power, the overall rate of inflation could rise at a rate that's very harmful to the economy this year.
Looking out even further toward the end of the year, investors might grow optimistic about the end-of-year economic situation, as 2004's strong job growth could be seen as raising the prospects for holiday spending, hence giving the economy momentum as it enters 2005,
This time, they want to keep rates low to fight deflation -- a demon that may have vanished already. They might be successful again, but something else might build up, some other unintended consequence, including some inflation.
It contained a lot of generalized ideas, but it seems like just his thoughts about what the G-7 should discuss.
I think their general view will be more upbeat, but it remains to be seen how upbeat, because they don't want to cannibalize their main message, which is that policy will remain accommodative for a considerable period,
Expectations are one of the biggest parts of the inflation process,
The money channeled from failed industries to small businesses would be taxed at higher rates, and that would be harmful to the economy,
The Treasury market rally may be a bear trap. The rally lacks a strong foundation as well as the extreme pessimism that marks the end of sell-offs.
The Treasury market rally may be a bear trap, ... The rally lacks a strong foundation as well as the extreme pessimism that marks the end of sell-offs.
That makes it more likely we will need to have repeated hikes, because the economy won't succumb to a small handful of hikes.
