Well we have agreed that inflation is measured as a "bottom up"thingy ... in other words inflation is what it is to you and your peers and friends. Actually, most things are this way in our lives and gov. tries to exploit this by feeding us disjointed scraps of information leading us to believe that it is we who are out of step and must change. So lets move on to the "top down" approach for the macro picture. Try adding these two statements together ... "No dominant power in the world has ever survived the self destruction of it's own currency" "Things today move far more quickly than we can imagine. Take Tunisia and Egypt as just two examples" As of now, the economy is stagflating and the game plan appears to be to reverse this stagflation so that prices and incomes will inflate, whilst the dollar deflates. In theory people will keep their incomes but pay more back in sales tax, taxes muni fees, insurances etc whilst the falling dollar will offset the wage disparity with the world and enable US to export it's way to some sort of stability as todays dollar repays yesterdays debt. Like all things that appear too difficult at the time, they are stuffed in a corner and this current situation is no different. Sometimes they simply disappear because circumstances change or because we made too much of a big thing of them at the time. Sometimes they are patched over to outlast our tenure and thereby land on the next guy's watch. Whether this plan of the WH and the FED succeeds or not, please remember history records no such success in the last five thousand years. However this puppy flies beyond the radar of most Americans. The real issue for most Americans is that they have been placed in an unwinnable position. If they can get or hold onto a 40 hour job and their wages double, you can bet that their expenses will triple. Many people will never see 40 hours again and some will never see a job again, just to make matters worse. Those people who are doing well right now will become more and more attached to the long side of the markets and quickly forget the dangers of the short side. Right now the S&P is sitting at 1300 with every prospect of reaching beyond 1500 before years end. It's value point is around 900 right now and so we are once again into a bubble even before we have repaired the last one. And this brings me to my last statement. "No bubble has ever survived" Either S&P earnings need to catch up quickly or the markets will fall again. Whilst this post is very simplistic, it has danced clear of detail in order to show that the majority of Americans cannot win now or in the future. Right now, American society is orderly with the small group of increasingly rich people coexisting with the ever increasing poor. This imbalance can only grow in my opinion. To see where US will be in a few years, please take note of Egypt right now. There is a startling similarity. Americans are in denial whilst the Egyptians are in de Nile.
"Best thing since sliced bread" is one of them English idioms, y'know? http://en.wiktionary.org/wiki/greatest_thing_since_sliced_bread As to what I do and do not understand, I fear you're very confused, my friend. Just because I agree with a particularly sensible argument NNT makes doesn't mean I have to agree with everything he says, as if it were gospel. The drivel he's been spouting since he's become a media whore and sold his intellectual integrity is so full of hot air, it's of no interest to me whatsoever. At any rate, we're just going to have to disagree on the value of NNT in our lives.
zdreg, i totally agree with what you said in your opening post. I wish we had price deflation here in the UK. However, our prices are rising officially at around 4%-5% pa, unofficially, tack on another couple of percent. Something for you Yanks to look forward to this year, lots of price rises!
you know, i don't like being a broken record but what is here in the u.s.a. is called STAGFLATION. go look up the word and think about it a while. bp yes, the fed is fighting a losing battle at the expense of every person in our country .