Like the Picture of Dorian Gray, the US economy "looks better" than it really is...
Today's retail numbers are being ignored as a one time fluke because of the Hurricanes...but the gas price increase doesn't seem to be wavering that much.
Indeed, heating oil and natural gas are still at record highs...
SO MUCH OF THE RECENT ECONOMIC PERFORMANCE IS ATTRIBUTABLE TO GREENSPAN'S "ONE PERCENT SOLUTION" THAT IT IS IMPOSSIBLE TO TELL: WHAT'S REALLY HAPPENING "OUT THERE...."
The GREENSPAN GAMBIT was so risky and novel...so devil may care about the strengh of the dollar, that the current inflation scare now seems almost inevitable. Curiously, many in the bond market think that if the economy tanks...Greenspan will simply revert back to his ultra-easy money... But NOT SO FAST.
THE REAL PROBLEM IS THAT THE DEBT, DEFICITS AND THE DOLLAR HAVE NOT BEEN HANDLED PROPERLY BY THE FED...
THE G-MAN SUPPORTED EVERY CRACK POT TAX CUT THAT BALOONED THE MANY DEFICITS... AND THE TRADE DEFICIT IS NOW A SUBJECT WE NEVER DISCUSS....except when Greenspan says that it will all "correct eventually."
Saddly, Greenspan never elaborates IN DETAIL about how this "correction" of the dollar will feel to the average consumer... But...
Now fast forward to the present...gas is a record highs, consumers have quit shopping, job and wage growth are punk and getting punker by the month... These are all highly predictable consequences of Greenspan's gross mismanagement of monetary policy since the dot com crash.
Of course the media provides convenient scapegoats per usual...like Hurricanes, and the recent unpleasantness in the middle east and in Iraq/Iran...
BUT GREENSPAN'S HYPER-INFLATIONARY MONETARY POLICY IS NEVER EVEN MENTIONED...AS A POSSIBLE CAUSE OF THE PROBLEMS.
THE DAYS OF "ASSET INFLATION FOREVER" ARE ALAS, OVER...OR AT LEAST THEY HAVE MIGRATED TO THE COMMODITIES MARKETS FOR THE DURATION OF THIS CYCLE...
IN SHORT, THE MASK IS BEING RIPPED OFF THE US ECONOMY NOW... AND LOOKING IN THE MIRROR WILL NOT BE EASY...ESPECIALLY IN 2006.
OSCAR WILDE WOULD LOVE THIS ENDING...!
