Government and its henchmen are anxious to relegate into oblivion the fact that this rise is produced by an increase in the amount of money and money substitutes. They never mention this increase.
Envy-based policies seem to persist, whether in the form of progressive taxation or in assumptions that a state like New York can decide something as subjective as the reasonableness of salary contracts freely agreed upon.
If Congress wants to end speculation, then I would suggest beginning with the deal makers at the Federal Reserve.
The government wants to shape perceptions in order to minimize dissatisfaction with its irresponsible monetary and fiscal policies. When the financial press goes along and parrots statements that are obviously false, it fails in its duty to its readers.
The US House of Representatives will hold hearings on energy markets trying to determine who is causing oil prices to rise.
As with everything else in life, competition among conceptual frameworks is very healthy, since it can quickly highlight when an economist is likely abusing his favorite technique.
Gordon is incensed that a few "analysts," including myself and Professor Stan Liebowitz of the University of Dallas, have argued that the bursting of the housing bubble has caused the chickens to come home to roost, so to speak, after thirty years of government policy pressuring banks to make tens of billions of dollars in bad loans to people with low (or nonexistent) credit ratings.
In the present article I am not taking a stand on whether price inflation will be high or low in 2008.However I will say this: If you are revising your inflation forecasts downward because of your expectation of sluggish economic growth, you might want to rethink that logic.
Capitalism should not be condemned, since we haven't had capitalism.
The Producer Price Index is out and it shows a change in intermediate goods in March 2008
