Both Mish and Russ are fighting the myth that Feds are pumping liquidity into the system.
They are not. What uneducated media takes for liquidity and inflation is just a credit bubble. Remember, money is a claim for goods, credit is a claim for money. If the borrower is in financial difficulty the credit is not as good as money and is very hard to collect. All this “inflation” is just speculation on margin.
What most economists are missing or are too shy to mention is that the last time the credit bubble of current magnitude happened it was back in 1920s and never again since then. More about that in my Kondratieff wave page
September 25, 2007 at 3:06 pm
I don’t think either Russ or Mish know jack shit. Both have been wrong for years and that’s probably why they toil for hours writing blogs for banner ad revenue. Russ even has a tip jar and begs for contributions.
These guys are jokes in my opinion. People who know how to trade and speculate are minting money and are laughing their asses off at these two morons.
September 25, 2007 at 3:08 pm
You’ve nailed it. Most of the “inflation” is predicated, not on money, but on credit. What is predicated upon money is showing up mostly in dollar-pegging currencies.
September 26, 2007 at 4:19 pm
If you can believe the PPT exists then you can believe they are pumping.
September 26, 2007 at 4:42 pm
Worried – you scored