Bending the Third Rail
Because We Should, We Can, We Do
Friday, July 28, 2006
Chart of the Week
This is an amazingly revealing chart:



This chart shows how inflation has been brought, and kept, under control from the energy crisis years in the 70's. The bears (of which I tend to be one) contend that economic fundamentals have changed due to energy prices and due to deficit/debt. Ten year bond rates are now bumping up against the high downtrend line. Should that line be broken, it would indeed be highly suggestive that something is going on that is different from the past 30 years, and that stagflation is a problem.

We shall see.
Written at 8:21 AM by Greyhair.
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