The Federal Reserve
In June and July “economists” and the Fed told everyone to watch out because of a “deflation risk.” Then suddenly, before you could say “Ben Bernanke” everyone is worried about the Fed and their warning of coming inflation. “[I]nflation surely remains a more serious danger than deflation.” Said George Melloan with the Wall Street Journal. [...]
The economic trends at the beginning of the year could be called “promising” and current trends could be looked upon as “not-so-great.” Some still find hope that the economy will soon recover, but when recent trends are compared with ones during the Great Depression it gets a little too close for comfort. Last Friday stocks [...]
“Inflation Hits 44-year Low” read the recent headline. The problem: 44 years ago the U.S. had high inflation. Brian Domitrovic’s book Econoclasts: The Rebels Who Sparked the Supply-Side Revolution and Restored American Prosperity (2009, ISI $27.95) is an excellent introduction to historical economic situations from 1913-1990. Domitrovic goes through the problems, and the solutions (working [...]
Inflation, to the ignorant, means nothing. To the economist and investor, frightening.
What is Inflation?
Simply put, the devaluation of a currency. For example, if inflation is 2%, and The Communist Manifesto is worth $1 (it’s really not worth that much), then within a year it would cost $1.02.
That seems rather insignificant, but it build up over [...]
