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To: Razzz42

Oddly QE2 works only if there is wage inflation and the corresponding real estate inflation that let’s all those underwater mortgages float in value.

If there is no wage inflation and no real estate inflation then there is only commodity inflation.


10 posted on 11/04/2010 10:23:45 AM PDT by MontaniSemperLiberi (Moutaineers are Always Free)
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To: MontaniSemperLiberi
there is only commodity inflation.

And only as long as the consumer has money to buy the commodities in question. (cross elasticity of demand) If they are produced within the country there is no cost push because of currency exchange. Only on the imported products, and those only if our currency is deflating against the specific foreign currency.

Solution, produce our own. Slash the Federal government cost, regulation and presence in our lives.

18 posted on 11/04/2010 11:40:33 AM PDT by Texas Fossil (Government, even in its best state is but a necessary evil; in its worst state an intolerable one.)
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