Minyan Mailbag: Elephant in the Room
Note: Our goal in Minyanville is to remove intimidation from the financial markets and encourage an interactive dialogue among the Minyanship. We share this next column with that very intent.
The CRB Index is right now sitting on trendline support that dates
back to November 2001 low. The elephant in the room is right now
nicknamed Inflation, but if the commodities trendline is broken, I
wonder how long it will take for that elephant to be squeezed out and
replaced by something else?
Scott Reamer wrote a great piece about deflation and decreasing time preferences. Now, take a look at what Fed Governor Donald Kohn said this morning
"The federal funds rate appears still to be below the level that we
would expect to be consistent with the maintenance of stable inflation
and full employment over the medium run.
"And if growth is sustained and inflation remains contained, we are
likely to raise rates further at a measured pace." Further Fed
changes to interest rates should induce an increase in the personal
savings rate, by increasing a return to saving and dampening the
upward momentum in housing prices, Dr Kohn said."
My reaction to that is be careful what you wish for, you just may get
it; some elephants play nicer than others.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter