Friday, September 28, 2007
Inflation? What Inflation? (Continued)
Winner of the "no kidding" award of the day:
The Fed rate cut is already stoking inflation. Can't wait to see what happens after Uncle Ben showers us with a 25 bps cut in October and either a 25 or 50 bps rate cut in December.
$95 oil? $15 wheat bushels? $5 loaves of bread?
Gotta love this "bestest economy ever."
Commodities had the biggest monthly gain in 32 years, led by wheat, crude oil and gold, as the dollar's slump enhanced the appeal of energy, grains and precious metals as a hedge against inflation.
The 19-commodity Reuters/Jefferies CRB Index was up 8.1 percent this month, the most since July 1975. Wheat climbed to a record in September amid a global grain shortfall, boosting corn and soybeans. Oil also hit a record, and gold reached a 27-year high. The Federal Reserve cut borrowing costs to bolster the U.S. economy, sending the dollar tumbling.
``The Fed has signaled pretty clearly that they will answer the problem of a slowing economy with greater liquidity,'' said Chip Hanlon, who manages $1 billion at Delta Global Advisors Inc. in Huntington Beach, California. ``We're in a bullish phase for commodities.''
The Fed rate cut is already stoking inflation. Can't wait to see what happens after Uncle Ben showers us with a 25 bps cut in October and either a 25 or 50 bps rate cut in December.
$95 oil? $15 wheat bushels? $5 loaves of bread?
Gotta love this "bestest economy ever."
