- Markets have been volatile but economic data still looking bad
- Chicago Fed National Activity Index: contrary to expectations, came in at -.42 in addition a downward correction for last week to a 2-year low
- Weekly Redbook Same Store Sales Survey down to lowest annual increase in 4 years with a dramatic rate of decline in recent months
- Implausible excuses, such as the weather or the timing of Easter, attempt to mask the fact that the economy is just weak
- Oil prices moved above $57, forming a sizable W-bottom
- Canadian dollar up about 5%
- Canadian inflation, especially food prices up
- This signals the end of rate-cutting cycle in Canada
- Central banks around the world are going to have to dial back on their cheap money policies
- The “Threat of Deflation” will be in the rear view mirror
- Central banks may like high prices, but consumers don’t
- President of the Federal Reserve Bank of Boston Eric Rosengren stated our 2% inflation goal is “too low”
- He thinks higher inflation allows for more growth, and allows interest rates to remain low
- Cheap money does not create economic growth and doesn’t create employment – it undermines both
- Cheap money applied to a slower economy creates a vicious cycle
- A weakening dollar will put upward pressure on already rising consumer prices
- The Fed is hinting at a higher inflation goal
- The problem is we can’t do anything about our inflation because our debt is out of control
- Fiscally solvent countries are able to raise rates and still service their debt
- All the U.S. can do is “talk tough”
- If they had a “Hall of Economists” in Disneyland, the Keynesians would have to be in Fantasyland
- Paul Krugman’s Keynesian experiment is blowing up the U.S. economy
- Everybody will figure it out before Paul Krugman does
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