Sunday, October 11, 2009

Worried about inflation?

I see it transmitted to us via the rising property prices. Car prices are rising too but its logic is peculiar to itself because of government control. What is worrying is when people start acting on their inflation expectation. So far there is no goods hoarding. The money is going into financial assets.

One full circle they will discover that the economy is weak and the higher prices aren't justified. Asset bubbles will burst.


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