Inflation is the only way that people can 'catch up' their mortgage payment. In other words, if you hang on a while, inflation will make your payment lower in real terms (your salary will increase meantime hopefully), and thus the value of your home appears to stabilize then being increasing.
In reality inflation is stealing the banks money..but the Fed is giving it to them anyway.
Wait until he gets wind of retail sales for December. They stink!
Merrill Lynch Chief Economist David Rosenberg is suggesting a 100% probability of a recession. The yield curve (10-year note/3-month LIBOR) and corporate spreads (Baa) are indicating that a recession will occur within the next 12 months.
The FED is responding to a perceived liquidity crunch by shoveling billions into the money supply when they should be looking at a solvency problem for those who invested into real estate backed securities or those companies that are connected to real estate. The money is sitting or going to anything but real estate or related securities.
You can have both inflation on the one hand and deflation on the other hand. :new_smile-l: