On the Economy from Outside the Beltway
A discussion of interest rates and inflation awaits at Outside the Beltway.
One of our favorite blogs Outside the Beltway is. Starting to sound like
Yoda.
Here is the link
Here is our comment regarding this post and the economy:
The Fed regularly links control of inflation as one concern in regulating
money supply. Investment gurus like Marting Zweig and Peter Lynch
place significant emphasis on both interest rates and inflation. The impact
of the bad boys from Enron, WorldCom and investment banking on Wall
Street have more impact on this subject than people would like to believe.
What I can’t understand in all the discussions of the state of the economy,
even discounting political rhetoric, is why no one focuses on the leading
market indexes or indices as being historically flat for the past five years.
11000 on the Dow was reached five years ago or so and we’re still dang-
ling around that number. Even though a market index is merely an adjusted
representation of the health of a selected number of stocks and the index
components change, there is still a psychological effect on the market that
is very real. If not a trigger for market movement up or down than why do
we obsess about its value so much?
I contend that we never surfaced from the last economic dive and are
floundering to find a true course and as such will probably continue to
wander aimlessly until resolution on some matters is sufficient to cause
some serious sustained economic growth.
Posted by Stanford Matthews at August 30, 2006 18:58