My Understanding of TIPS
Competitive Sourcing Continues to Fail
Inflation Should Be Just Around the Corner
But let us be honest. Attempting to increase inflation may not work, particularly if private-sector spending does not respond. The policy response that is in the works is likely to be massive. But what we have already seen over the past 12 months is unprecedented and, to date, not very effective.
So what do markets think? Last week they weren't sure. At the close on Friday, inflation-linked bonds priced in only 0.2 percent average inflation for the next ten years; this sounds like a deflationary spiral. However, the world's oldest inflation hedge, gold, rose sharply, suggesting that some investors think we will soon be successfully inflating. Let's hope the gold market is right.
Balance sheets and income statements: breaking the downward spiral
Addressing the Economic Crisis while Renewing Our Commitment to Fight Climate Change