Board-Ansicht
Mix-Ansicht- Foreign Investors, Get Ready To Be Paid Back In Cheaper Dollars - Cosa, 11.07.2002, 12:20
Foreign Investors, Get Ready To Be Paid Back In Cheaper Dollars
Moin,
ein erneuter Versuch zwei interessante Artikel zu posten, hier Nummer eins....
<font size="4">Foreign Investors, Get Ready To Be Paid Back In Cheaper Dollars</font>
July 08, 2002
Well, it looks as though the fix is in. Greenspan has gotten the go-ahead from none other than
his unbiased staff to step up US inflation. I am referring to the recent Fed staff study that
everyone else is referring to these days,"Preventing Deflation: Lesson from Japan's Experience in
the 1990s." One of the conclusions of the study is that when inflation gets closer to zero, the odds
of deflation increase. Duh! If a price index is exhibiting no growth, then, of course, it is more likely
to contract a 1% than if it were initially growing at 6%. The study goes on to speculate that if
interest rates also are near zero when there is price-index stability, then monetary policy could be
rendered impotent if deflation should occur. Why? Because with nominal interest rates at zero and
accompanied with deflation, then the Fed would not be able to lower"real" interest rates. This is
the conventional wisdom. Of course, the Fed could crank up the money printing presses, even at a
zero nominal interest rate, and create more inflation. This would lower the real rate of interest
even with a zero interest rate.
But the last comment is mine, not those of the study's authors. And it is the comments of the
authors that Greenspan wants to hear. Now, judging from the nearly 8% year-over-year growth in
M2 and the rise in commodity prices, as shown in Chart 1, there is little reason to be concerned
about deflation here in the US of A. But, because we are the biggest net-debtor nation in the
world, deflation could beget more deflation as it would make it more difficult for us to service our
debt. So, as net debtors, we Americans want inflation, not deflation. And Greenspan aims to
please us now, just as he did when he created the credit to inflate the stock market.
Chart 1
Paul Kasriel
Quelle
<center>
<HR>
</center>
Thread gesperrtgesamter Thread:
