Lacy says no Inflation any time soon.... Extra !Extra ! "Third quarter review and outlook"

NumbersUsacom

Last paragraph of Hoisington Managements 2012 Third Quarter Review and Outlook:

"As commodity prices rose initially in all
the QE programs, long-term Treasury bond yields
also increased. However, those higher yields
eventually reversed and generally continued to
ratchet downward, reaching near record lows. The
current Fed actions may be politically necessary
due to numerous demands for them to act to
improve the clearly depressed state of economic
conditions. However, these policies will prove to
be unproductive. Economic fundamentals will not
improve until the extreme over-indebtedness of the
U.S. economy is addressed, and this is in the realm
of fiscal, not monetary policy. It would be more
beneficial for the Fed to sit on the sidelines and try
to put pressure on the fiscal authorities to take badly
needed actions rather than do additional harm. Until
the excessive debt issues are addressed, the multiyear
trend in inflation, and thus the long Treasury
bond yields will remain downward".

Hoisingtons full report Here

cohodk

Until the excessive debt issues are addressed, the multiyear trend in inflation,................... will remain downward".

Couldnt have said it better myself.

Soon we will begin to see downward pressure in sports salaries.

jmski52

I'm beginning to see the point about all of these newly-created dollars, just laying around and accumulating in bank accounts and banks, doing nothing. Yeah, what's the harm in another $40 billion a month just for good measure?

I'm sure that nobody will notice, until they need to be spent. There won't be any competition with the dollars that people had to actually go out and earn, will there? Nah, that's just fear-mongering.

Your dollars will be in competition with the dollars that were created for the benefit of people and entities who didn't work for them. I can't seem to put my finger on it, but somethin's just not right.