Susiepolls2008


central banks can cause inflation by permitting excessive growth of the money supply,[8] and the government can cause stagnation by excessive regulation of goods markets and labor markets;[9] together, these factors can cause stagflation. Both types of explanations are offered in analyses of the global stagflation of the 1970s: it began with a huge rise in oil prices, but then continued as central banks used excessively stimulative monetary policy to counteract the resulting recession, causing a runaway wage-price spiral.

Stagflation has generally proven to be difficult and costly to eradicate once it gets started.

Unfortunately, higher inflation is coming from every direction you care to look. Normally, the Federal Reserve and the European Central Bank would move to stomp out inflation by raising interest rates. Now, thanks to a weakening U.S. economy and turmoil in the debt markets, the Fed is lowering interest rates instead, and both banks are flooding the financial markets with short-term cash.

China, Russia and other emerging-market economies determined to keep their currencies from gaining against the dollar are creating money to buy dollars, inflating their own currencies, and that money is fueling booms in stock and real-estate markets. Inflation hit 6.9% in China in November, for example. And these countries are exporting some of their inflation in the form of higher prices for developed-world customers such as Wal-Mart Stores (WMT, news, msgs). Demand from these fast-growing economies for raw materials is driving up the price of coal, iron ore, corn, wheat, oil — just about every commodity you can name. A falling U.S. dollar is driving up the cost of everything the country imports, from oil to children’s toys.

Normally, the Federal Reserve could count on a slowing economy to take a bit of wind out of inflation’s sails. But many of the current causes of inflation aren’t linked to the U.S. economy. We could get inflation and slower growth — the definition of stagflation.

http://articles.moneycentral.msn.com/Investing/JubaksJournal/Is70sStyleStagflationComing.aspx

Dave Holman


This trillion dollar bailout is nothing more than a ***** power grab by both sides in D.C. to attempt to nationalize the entire Financial Services Sector in this country.

For those of you who will attempt to “dis” my understanding of the economy, I will point out
1)I am self-employed, and won’t lose my job. My mortgage is fixed and very affordable. I don’t have any consumer debt to speak of. So, the bailout will not help me in any way, and it will, potentially damage me to the tune of thousands of dollars in taxes for God-only-knows how long

2)There is no way it stops here. If Washington succeeds in nationalizing the Financial Sector, Automotive, Retail and every other sector will have their hands out to get theirs, and we end up with complete Socialism.

3)My portfolio (and millions of other peoples) has only been negligibly affected by this correction. I would never invest in “air” which is what the Financial Services Sector is - my money is in commodities, transportation and agriculture - real things, that have intrinsic value….they are holding up pretty well. and

4) I remember the ‘87 market correction, which was roughly TWICE as sharp as this drop, IN ONE DAY, and the only thing done was to curb “program trading” (the abuse d’jour in those days), and within a year and a half the market not only recovered but began a long bull market.

This bailout is not necessary. period

And see…this is what convinces me. Some of you are way far Right, like me, and some of you are way far Left….and on THIS we agree….doesn’t it stand to reason if EVERYONE on both sides can agree, that it really is a bad thing?
asjrb - how long can banks refuse to lend money, and still MAKE money? don’t you think someone will step in, if that happens? Someone out there is willing to make money, I am sure.
What the banks are doing right now is simple blackmail…if we refuse to give in, they will either start lending again, or go away….and someone else will step in…I prefer not to negotiate with terrorists.

politicoswizzlestick


The entire US economy requires Oil at reasonable costs. All of our jobs are reliant on Oil.

That said, is it unpatriotic to put your investment dollars into Oil as a commodity? (I am not saying investing in Oil companies too— only Oil as a commodity.)

A lot of people who invest look at our economy and our national debt and see bad days on the horizon, so they move their money from stocks into commodities. Gold and Oil are two favorites as their prices consistently rise as people buy them.

Headline News said it costs $50 to produce a barrell of Oil. Oil is selling for $139 a barrell. Headline news says speculation on Oil has created that disconnect.

Are people being greedy at the expense of the nation to buy something our country needs (oil) instead of something we comparitively really don’t (gold)?

Gas cost $4 a gallon today. If Oil ran say $65 a barrell, it would cost $1.87 a gallon.

skahhh


Her daughter Chelsea runs a hedge fund and she cries wolf about oil prices and fairness to the American people!

How can she be so bold as to have “The Audacity of Hope” in her about this economic situation when her money is likely invested in our further plight?
I expect this “act” from rich males, but are females just as ruthless, and willing to stand and lie in front of the American public? I thought I could expect more from a woman! Are women liars too?