Random, that is a good nomiker for you; it describes nature of you comments...that and 'frivolous' or 'shallow.' It is not the natural order....examine history. How do you explain the current condition of deleveraging the private sector? It is good to ask why an apple falls rather that floats...it helped us put a man on the Moon. If you don't know why things fall or float...well again, I'm not sending you out for chocolate.
Stardust, thank you for the thoughtful reply. I am glad I made you think about things. There is much we could talk about with regard to interest. In a way, not exactly...but in a way, you could say that it is the interest that causes the inflation. However, the interest is not the cause; it is a result of capital flowing out of financial assets and into tangible assets that can be leveraged. The interest rises in a self reinforcing system of increasing leverage ratios and increasing asset values...interest is always high when you have real inflation. I am pleased that you realize that inflation is an invisilbe un-legislated tax...especially in a progressive tax structure...and it taxes the poor and the middle class the most....but maybe more on this another time.
Some cycles end just fine. The dip is short, not too deep and the recovery is robust. My feeling is the coming downturn will have none of thos attributes.
Nobody is "deleveraging the private sector". You have a knack for consistently getting cause and effect exactly backwards.
"Nobody is "deleveraging the private sector" Do really think that is true? Have you noticed what is going on in housing? Default is a form of 'deleveraging.' Private credit has been contracting for several years...you can check that at the St. Louis Fed web site...declining aggregatge private credit is the definition of deleveraging. What is your cite or source for asserting that the private sector is not deleveraging? "You have a knack for consistently getting cause and effect exactly backwards." Please identify what cause and what effect I got backwards...was it the fall vrs the float? Was it in my comment about your Random reparte'? What cause effect did I describe with regard to deleveraging? Was it is my matrix comments? What are you talking about?