US Economy: IS that the inflation you want?
Of course many consumers instantly abhor the idea of inflation spilling over to politicians getting to believe in their actions having an actual effect on theEconomy targeting inflation. However, as we and certain powers that be at the Fed in the US and RBI back home in India have posited many a time despite targeting a manageable inflation, some inflation can be good for the Economy. Apart from what me, others and Krugman might believe about the growth imperative consequent on inflation, spending’s direct positive impact on stimulating healthy interest rates and economic activity led growth and perhaps the mathematical certainty that near zero interest rates have limited Fed’s control over the Economy..there may well be more to inflation building up into a object of desire for most western nations as banks sap out the bilious stimulus and everyone in europe is well near the end of their purse strings.
Wow, as long winded sentence construction goes, that one is probably what the doctor ordered for summarising another global economic pique we are facing. Gasoline inventories in the US are not rising but Crude inventories are at their highest. The Dollar has been decimating every other currency in the last two weeks and the Euro has been falling on its own (lack of) steam. However, we forgot to detail an important thing in this war against policy akers who want to shut out inflation and are perhaps happy with a long bout of deflation, the way they use the gridlocked Congress in the USA. as another news magazine with a nominal grasp or a titular gnat of “Economics” just mentions on the cover, the detail is in the kind of inflation we have been getting to.
A 2008 cover of The Economist
Food prices have taken an awfully long time to come to a place where they can be seen to be cooling off and despite our endless optimism in this recovery cycle, it sis probably far ahea do f where it should be except in our Asian economies where the produces of farm goods are still dubious of the “Growth paradigm” of urban expansion as they leave Farming for better employent elsewhere. Oil prices hare still not coming down for the consumer, neither in the US nor in India or other Asian stops where growth continues despite the cost of inputs brought back to above par by a depreciating currency, keeping both sides of the globe permannent floating underwater, submerged by hope and by degrowth in the same