Today's lower than expected GDP has pundits rightly finding that the
Fed will not raise rates anytime soon.
And, indeed, if the Fed waits "til jobs come back."
THEY MIGHT WAIT FOREVER! BECAUSE;
THE US ECONOMY HAS A "STRUCTURAL PROBLEM" ABOUT JOBS;
THEY ARE ALL MOVING OFF SHORE!
SO VERY LIKELY ANY "STIMULUS" WILL JUST INCREASE THE TRADE DEFICIT,
BUT DO NOTHING AT ALL ABOUT THE NOW "STRUCTURAL" JOBS PROBLEM.
Indeed, a cynic might say that the low rates and easy money are just
making the EXPORT OF JOBS EASIER! AND, THEY WOULD BE RIGHT.
THE ONLY HOPE FOR THE US ECONOMY IS TOO KEEP THE CURRENT STOCK BUBBLE
GOING BY THE CONSTANT DEVALUATION OF THE DOLLAR!
IN EFFECT REAL ESTATE AND PAPER ASSETS (LIKE STOCKS) HAVE BECOME:
DEVALUATION HEDGES!!
AND NOT REALLY HEDGES ON INFLATION!! YET!
Of course, this is an anomaly because you can't devalue FOREVER
without causing INFLATION SOONER OR LATER......
BUT! YOU CAN DO IT FOR A LONG TIME.
IF! IF! IF YOU HAVE THE COOPERATION OF OTHER CENTRAL BANKS!
SO FAR, ASIAN BANKS ARE GOING ALONG WITH GREENSPAN'S PROGRAM, NO
MATTER HOW LUNATIC IT MIGHT BE IN THE LONG RUN.
THE ECB IS NOT COOPERATING.
AND THEY ARE APPARENTLY WILLING TO PAY THE PRICE FOR HAVING A SOUND
CURRENCY!
AN ADMIRABLE CHARACTERISTIC FOR A "NEW MONETARY UNIT" LIKE THE EURO!
Don't Ya think?
AND, GREENSPAN'S NEW BUBBLE? ......to be continued!
Of course!
http://finance.yahoo.com/q/bc?s=EURUSD=X&t=1y&l=on&z=m&q=l&c=
