ajtj99's Market Pulse

[chainik]

I am mostly interested in gold, and for my investment purposes "inflation" should be defined "as continual decline in the purchasing power of money due to the increase in money supply" with the emphasis on "increase in money supply". As investor/speculator I really don't care about the prices of digital camcoders or PCs or "CPI" (which reminds me bs in "Pravda" 20 years ago). I don't care whether the rise in the prices of oil is "deflationary" or "inflationary" - some prices are likely to rise and some are likely to fall, and these changes are neither inflationary or deflationary, because they are not related to increase in money supply.

If M2 grows at 10%/year, this is a decrease in the purchasing power of money and, therefore, inflation by definition. During the last few years this money went into housing. I agree with you re "inflation" of the housing market. Not only does it pisses me off - it poses big danger for US economy.