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That inflation-growth paradigm and the Euro example | Advantage Research

The FOMC notes (though sparse and sketchy) and the big brouhaha over QE2 dulled many a financial experts’ mind when it came to nodding with Ben and keeping (probably) their date with the superbowl.  The krugman phenomenon of course finally went out of sync with us ( and we believe growth) when he nodded with the price stability measures so becoming of the Euro since its millenium launch. Well, the relationship in nflation and growth is a tenuous one and price stability invites deflation. Thus this quick reminder to Economists out there and “Bob the Bear” as well. For inflation to grow growth, all that paranoia around a 3.5% inflation would have to shut itself down from its contradictions. It needs your Fed to give a stability goal that in FACT ALLOWS A 5% INFLATION and I think we can resume the growth path. We all now know why Europe managed to bankroll a price stability measure the first time around. That was lies, statistics and even forged governments.

And that is a where we must come back to ponder rather than bury the similitude in the sand. The industry has started coming up with the answers, the paranoia around price stability is marring the punch, and QE3 and more are just because of a lot of quicksand that probably ( and again unwittingly) America is using to sandpaper the future where it will be no. 3 What ever that may be, healthy growth requires much as yen and dollar depreciation, a  sustained bout of inflation and though the nine feds may disagree,it should have been your book and not a running nose ahead of the “official target”

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This entry was posted on January 31, 2011 by in Amitonomics, Banking, Emerging Markets, TARP, US and tagged .

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