I will provide a general sample of the ISM for October Business. It is Good News and Bad News; otherwise termed the Kiss of Death. Business is signaling that they have functionally filled their Inventories to the level desired. The employment index would have to be around 70 to replace the lost labor since the Recession Start, and about 80 to return to the full employment of 2000 in percentage numbers. New Orders only indicated that the Christmas Season is upon Us, and Retailers are attempting to pretend that Sales will match Desires. Autos, Electronics, and Exports are closed industries, which eat up their own Customer base with previous provision. There is practically no Repeat business, except with destruction of purchased Product through usage. I remember the memorable Chinese torture of being Tickled to Death with Feathers.
Paul Krugman believes that he has proven something with this Posting, yet I wonder seriously if it is so. My real problem here is the question of repetitive QE. All percentages to my way of thinking must be estimated from prior to the first QE, not from the start of the Second QE. It is here that One can determine the degree of Inflation generated under QE, and the Numbers are much less desirable. There comes a time when central bankers must admit that they are simply inflating their Currencies to express Profit levels for themselves and private industry. I don’t know that much about these things, of course, but I have some conceptualism of printing Money from sheer braggadocio.
Such things as this information leads me to disarray, coming as it does that People must eventually pay for their Consumption through Personal Income. There is the fact that year-over-year increase in Wages was up 2.4%, but Wages are still less than before 2008. There has been much Inflation since the last Boom, even if Bernanke deems it dismal; remember, We are not even back to 2008 Wages. One has to ask Why economists insist that Recovery will be sluggish; I think the Answer might be because the Speedometer is reading nothing but Inflation, which could admittedly be getting rather Slow. The real Problem becomes do We want, and can We stand, to inflate our way out of Recession? lgl