ECONOMICS: Supply-Side Infation ConfusioN
Wesbury, Brian S.
ECONOMICS BRIAN S. WESBURY Supply-Side Inflation Confusion PUT TWO ECONOMISTS IN A ROOM, it's been said, and you'll get three different opinions. Funny or not, the observation...
...Budwig who have pursued cancer remedies and come up with remarkable natural formulas and diets that work for hundreds and thousands of patients...
...I have had astounding results from the easy to understand knowledge found in this book...
...If we can't use money growth as a measure of monetary policy, and market-based indicators are compromised by the sloshing around of massive amounts of leveraged investment capital, what tool works...
...They walked away from traditional cancer treatments...and were healed...
...Here is just a sampling of what others have to say about the book...
...As a result, the narrowing of the yield curve has become a misleading indicator...
...As a cancer patient who has been battling lymphatic cancer on and off for almost three years now, I was very pleased to stumble across How to Fight Cancer & Win...
...Over the past 40 years, the federal funds rate has on average been 2 percent above the annual change in the consumer price index...
...How many other treatments have they been allowed to hide...
...Throughout the pages of How to Fight Cancer & Win you'll meet real people who were diagnosed with cancer—suffered through harsh conventional treatments—turned their backs on so called modern medicine—only to be miraculously healed by natural means...
...There are only a limited number of books in stock—and unless order volume is extraordinarily high we may not be able to print more life-saving copies...
...Yet it has been banned...
...By simply eating a combination of two natural and delicious foods (found on page 134) not only can cancer be prevented—but in case after case it was actually healed...
...Time and again this life saving treatment worked miracles, but the FDA ignored the research and hope he brought and shut him down...
...She noted that every cancer sample analyzed (whether human or other animal) contained it This microbe—a bacteria that is actually in each of us from birth to death—multiplies and promotes cancer when the immune system is weakened by disease, stress, or poor nutrition...
...Directed by Wlady wwwispectatonorg 52 THE AMERICAN SPECTATOR JUNE 2005 Fed holds interest rates significantly below nominal GDP growth and real rates near zero, the faster nominal GDP will grow and the worse inflation will become...
...A bigger trade deficit makes it appear that the economy is slowing, when in fact, domestic demand is booming...
...The difference of opinion revolves around Fed policy and inflation...
...In the past year, nominal GDP has climbed 6.2 percent, but the federal funds rate is just 3 percent...
...Excluding food and energy, the "core" consumer price index (CPI) increased 3.3 percent at an annual rate in the first quarter, three times higher than 2003's inflation rate of 1.1 percent...
...The book was inspiring, well-written and packed with useful information for any cancer patient looking to maximize his or her chances for recovery" —Romany S. "I've been incorporating Dr...
...The longer the Fed holds interest rates significantly below nominal GDP growth and real rates near zero, the faster nominal GDP will grow and the worse inflation will become...
...He refused the surgery that our doctors advised...
...The Fed should manage monetary policy to hold long-term inflationary pressures in check, not to boost economic activity or lift stock prices...
...Because hedge funds are distorting the bond market, and demand for commodity funds is distorting the real goods market, traditional supply-side indicators are less useful than they have been in the past...
...You read that right...
...Find out what the Washington Prowler has uncovered...
...Burton's miracle serum these too go unmentioned...
...If it were true that demand for oil was rising faster than its supply, then oil prices would be higher all over the world...
...The Fed has only one tool—money—and that tool has very limited abilities...
...This problem will only get worse...
...Scientists and researchers applauded...
...Nominal GDP growth can be thought of as the average top-line growth rate of all businesses and investments...
...ECONOMICS B R I A N S . W E S B U R Y Supply-Side Inflation Confusion PUT TWO ECONOMISTS IN A ROOM, it's been said, and you'll get three different opinions...
...For interest rates, the reference point is inflationand nominal GDP growth...
...My whole life has improved drastically and I have done so much for many others...
...That means increasing the federal funds rate back above inflation and closer to nominal GDP growth—the so-called "neutral" rate, which is likely north of 4.5 per-cent...
...Worst of all, the microbes secrete a special hormone protector that short-circuits our body's immune system—allowing the microbes to grow undetected for years...
...Yet, healthy blood always contained these ingredients...
...Using it to argue that the Fed is too tight could cause major errors in monetary policy...
...The Fed reacted to this with artificially low rates...
...In addition, the economy faces a great many headwinds that have nothing to do with monetary policy...
...Rising commodity prices, a falling dollar, and a steeper yield curve are all signs of excess monetary liquidity...
...But the funds rate alone can be very misleading...
...It is a simple supply and demand calculation...
...Claim your book today and you will be one of the lucky few who no longer have to wait for cures that get pushed "underground" by big business and money hungry giants...
...90 minutes later they were gone...
...The same is true for many other commodities, including gold...
...This reduces exports and lifts the trade deficit...
...They borrow short and buy long...
...This suggests that the declining dollar (a sign of excess money creation) has played a big role in lifting energy prices...
...Some supply-siders are looking at these trends and concluding that the Fed has gone far enough...
...ID# P6F6H...
...Decades ago, European research scientist Dr...
...Keynesians rarely agree with Austrians, and demand-side economists can't see the supply-side...
...when it removes money, activity slows or contracts...
...This reduces growth...
...When the Fed holds rates above GDP some above average projects will not get funded because their returns are less than borrowing costs...
...But there is hope even for them...
...Black Listed Cancer Treatment Could Save Your Life Baltimore, MD— As unbelievable as it seems the key to stopping many cancers has been around for over 30 years...
...While low interest rates are always preferable to high interest rates, using the Fed to hold rates down artificially is a recipe for inflation—no matter what some supply-side economists believe...
...Every broad measure of inflation has shown clear acceleration in the past year...
...We purchased How to Fight Cancer & Win, and immediately my husband started following the recommended diet for his just diagnosed colon cancer...
...This inflation gauge is up 1.7 percent in the past year, and 2.9 percent at annual rate in the first quarter, both significantly higher than the 1 percent rate in the second half of 2003...
...Back in the 1960s, when Milton Friedman did his Nobel Prize-winning research to prove the importance of the money supply in influencing the economy, banks were tightly regulated...
...But these events may have nothing to do with the Fed...
...The Fed has only one tool to affect economic activity or inflation—manipulation of the money supply...
...Thanks for the wonderful information...
...This ended in the early 1980s, when the deregulation of banks and growth in the global financial system made money numbers virtually useless as a forecasting tool...
...The yield curve has also been influenced by hedge funds and others who have leveraged the Fed's "measured pace" of rate hikes...
...What's more, the world is full of expert minds like Dr...
...In the 1970s, this is exactly what happened...
...But lately a significant split has developed among supply-side economists...
...Over the months my P.S.A...
...When the Fed holds interest rates below nominal GDP growth, borrowing is encouraged because the returns to the average business project are higher than the rate of interest...
...You had to do an enormous amount of research to bring this vast and most important knowledge to your readers...
...For over 10 years now her methods have proved effective—yet she is denied publication—blocked by the giants who don't want you to read her words...
...50 THE AMERICAN SPECTATOR JUNE 2005 M OST WORRISOME is that the lag between easy Fed policy and the eventual increase in consumer prices is at least two years...
...As a result, it is a good proxy for interest rates...
...It is not natural for interest rates to fall below inflation...
...The information goes far beyond the health thinking of today...
...The last time the Fed held interest rates this far below nominal GDP was in the late 1970s...
...Instead I went on the diet discussed in the book combined with another supplement...
...Remarkably, what Dr...
...In fact, only the Fed can make this happen...
...Just as in the case of Dr...
...But saying there is no inflation does not make it true...
...Commodity prices have risen sharply in the past three years, but movement on a week to week, or even quarter to quarter, basis is influenced by dramatic flows of investment dollars in the hands of many who have no direct economic need for commodities...
...Budwig discovered that the blood of seriously ill cancer patients was deficient in certain substances and nutrients...
...And kept out of your medicine cabinet by the very agency designed to protect your health—the FDA...
...Another important signal of easy money is the rate of growth in total spending (otherwise known as nominal GDP...
...For example, U.S...
...The result was the worst bout of inflation the U.S...
...If the Fed adds more reserves (liquidity) to the banking system than the system demands, the federal funds rate is pulled lower...
...Johanna Budwig, a six-time Nobel Award nominee, discovered a totally natural formula that not only protects against the development of cancer, but people all over the world who have been diagnosed with incurable cancer and sent home to die have actually benefited from her research—and now lead normal lives...
...It includes real growth and inflation, just as an interest rate includes a real rate and an inflation premium...
...Gold prices have not budged when priced in euros, but boomed in dollar terms...
...Funny or not, the observation captures two key attributes of economists—their inability to take a stand and their radically different worldviews...
...has ever experienced...
...All market movements should not be placed at the feet of the Fed, as some would like...
...If the Fed supplies fewer dollars to the banking system than it needs, the federal funds rate is pushed higher...
...Others have taken to the airwaves and editorial pages in a campaign against further Fed rate hikes...
...However, when she went to publish these results so that everyone could benefit—she was blocked by manufacturers with heavy financial stakes...
...Negative real interest rates indicate that the Fed is adding more liquidity to the banking system than it demands...
...They are not...
...He scheduled a time to surgically remove the prostate, but I canceled the appointment...
...He was not only shut down—but also forced out of the country where others benefited from his discovery...
...It was the lack of these nutrients that allowed cancer cells to grow wild and out of control...
...As a result, money supply measures (such as Ml, M2, or M3) meant something...
...No wonder so many patients are riddled with cancer by the time it is detected...
...I believe the answer is simple: the federal funds rate...
...has lowered until the last reading was one point two...
...Duncan M. "In my 55 years as a Country Family Physician, I have never read a more 'down to earth,' practical resume of cancer prevention and treatments, than in this book...
...Budwig's natural remedy into my diet and have told others about it Your book is very informative and has information I've never heard about before (and I've read many books on the cancer and nutrition link...
...The Fed adds or subtracts reserves from the banking system by buying and selling bonds...
...It is impossible to determine if it is high or low without a reference point, just as the perceived speed of a passing vehicle depends on how fast your vehicle is moving...
...This artificially holds down long-term interest rates in a rising inflation environment...
...Today, even after eight Fed rate hikes, the 3 percent federal funds rate is still below the CPI (up 3.3 percent in the past year, including food and energy...
...Since following the regime recommended in the book he has had no problems at all, cancer-wise...
...No matter what inflation index is used, the federal funds rate remains historically low, very low...
...The problem is not Chinese demand, but too many dollars chasing too few goods...
...Headlines hit every major paper around the world...
...So WHERE DOES ALL THIS LEAVE supply-siders...
...The good news is that the Fed understands this and continues to state that "the stance of monetary policy remains accommodative...
...Thelma B. "I bought How to Fight Cancer & Win and this has to be the greatest book I've ever read...
...Molly G. Don't waste another minute...
...New York Attorney General Eliot Spitzer, scandal at AIG, high oil prices, Iraq, the Sarbanes-Oxley legislation, and uncertainty about tax and Social Security reform can each have a negative impact on equity prices...
...Two-Nutrient Cancer Breakthrough...
...Some believe that the CPI overstates inflation and prefer to use the "core" personal consumption deflator to measure price pressures...
...P6F6H P.O...
...Many, including this writer, worry about rising inflation, and an excessively accommodative monetary policy...
...As early as 1947, Virginia Livingston, M.D., isolated a cancer-causing microbe...
...To automatically attribute every slight movement in markets to the Fed and its policy choices is myopic...
...Or write "Fight Cancer—Dept...
...Box 925 Frederick, MD 21705-9838 If you are not completely satisfied, return the book within one year for a complete and total refund—no questions asked...
...My doctor found two tumors on my prostate with a high P.S.A...
...To get your copy of How to Fight Cancer & Win call 1-888-821-3609 and ask for code P6F6H to order by credit card or order online at www.agorahealthbooks.com/spec5...
...P6F6H" on a plain piece of paper with your name, address, phone number (in case we have a question about your order) and mail it with a check for $19.95 plus $5.00 shipping to: Agora Health Books Dept...
...Brian S. Wesbury is The American Spectator's economics editor and the senior managing director of Claymore Advisors, LLC...
...That was 38 years ago...
...How to Fight Cancer & Win author William Fischer has studied these methods and revealed their secrets for you—so that you or someone you love may be spared the horrors of convention-al cancer treatments...
...The end result was stagflation...
...Rising tax rates, expanding regulation and sharp increases in government spending, created a stagnant economy...
...If not cured, we believe the cancer has to be in remission...
...See what daily insight from eumayr quoted e who4ho in Washington and to radio...
...Budwig discovered was a totally natural way for eradicating cancer...
...The proliferation of hedge funds, and asset allocation by pension funds and large endowments toward commodities, has also made life more difficult for supply-siders...
...This will probably be the most important information you and your loved ones receive—so order today...
...In other words, the inflation that we are witnessing today was created in 2001 and 2002 when the Fed began an aggressive response to the threat of deflation...
...After 30 years of study, Dr...
...JO Davirg Shawn Macomber and of course, RET...
...Blocked...
...Six-time Nobel Nominee's Two-Nutrient Cancer Breakthrough Revealed Turn to page 82 of How to Fight Cancer & Win for the delicious diet that can help stop the formation of cancer cells and shrink tumors...
...Symptoms of cancer, liver dysfunction, and diabetes were completely alleviated...
...Others blame rising commodity prices on demand from China and India, suggesting that Fed policy is not responsible for their increase...
...However, when valued in euros, commodity prices have not climbed to the extent they have in dollars...
...Lately, as the Fed has hiked rates, commodity prices seem to have peaked, the dollar may have hotB R I A N S . W E S B U R Y tomed, and most importantly, the yield curve has flattened...
...The longer the JUNE 2005 THE AMERICAN SPECTATOR 51 ECONOMICS Every day...
...In 1966, the senior oncologist at a prominent New York hospital rocked the medical world when he developed a serum that "shrank cancer tumors in 45 minutes...
...Assuming that these problems can be fixed by easy money and low interest rates is a recipe for disaster...
...THE FINAL PROBLEM facing the inflation-doubting supply-siders is the so-railed "soft patch" in the economy and a waffling stock market...
...Hugh M. "I can't find adequate words to describe my appreciation of your work in providing How to Fight Cancer & Win...
...Moreover, anecdotal evidence from corporate executives suggests that pricing power has returned as total spending in the economy accelerates—each a clear sign of an inflationary Fed policy stance...
...They vehemently deny that inflation is a problem and argue that a weak stock market and some softness in economic data are proof that the Fed has lifted rates far enough...
...imports are soaring because of easy monetary policy, while our major trading partners face slow economic growth...
...For example, the euro price of oil is not any higher today than it was in 2000...
...Economists of the same stripe typically agree...
...These markets react much more quickly to money creation than GDP, unemployment, or broad measures of inflation...
...As a result, supply-siders started to use other tools to measure the Fed...
...This boosts growth...
...These policies also affect interest rates...
...When the Fed adds money to the economy, economic activity increases...
...Edward S.,M.D...
...It needs to be studied worldwide for the prevention of cancer by all researchers who are looking for a cure...
Vol. 38 • June 2005 • No. 5
