Ed Phillips on Wed, 16 Jul 2008 03:12:35 +0200 (CEST)

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Re: <nettime> Paulson's face


I don't see M3 growth slowing, although I follow you on the rest of what
you said. Most estimates of M3 show a big infusion.

The U.S. policy is deflationary in a sense, nonetheless, or is trying to
be, in order to relieve the tension of the trade imbalance? Not
deflationary for consumers but in terms of money supply

The bigstory is not the SWFs and the ways that they are rounding out the
portfoilios of the new creditor nations but the buying of massive
treasuries and Agencies by the central banks as their part of relieving the
tension of the trade imbalance without driving up their currencies too
quickly. But the tension smuggles in as inflation.

No wonder the US Fed is more afraid of instant recovery than a dip
towards recession.

I take what Soros says cum grano salis, of course. 

On Tue, Jul 15, 2008 at 11:24:56AM +0200, Stefan Heidenreich wrote:

> Dear Brian,
> don't bet on inflation too early. Stagnation & Inflation
> (stag-flation, as we had it in the 70s) might be in the making.

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