Has the National Review not realized how stupid this gasbag is making them look?
Gold spiked $30, a clear message that Bernanke & Co. won’t stop inflation. Stocks plunged over 200 points, an equally clear message that the Fed’s cheap-dollar inflation is damaging economic growth. These market warnings are two sides of the same coin. Inflation, which is caused by excess dollar creation, is the cruelest tax of all.
That’s right boys and girls – the market sees hyperinflation just around the corner. It’s not possible that the market was disappointed that the FED did not try to lower real interest rates which would have caused a market decline. Oh no! But I interrupted the Village Idiot:
It is an interesting historical footnote that Paul Volcker is still highly regarded as the greatest inflation fighter of our time. Working with Ronald Reagan, it was Volcker who slew the inflation dragon in the 1980s. Indeed, the combination of tighter monetary control from the Fed and abundant new tax incentives from Reagan launched an unprecedented twenty-five-year prosperity boom characterized by strong growth and rock-bottom inflation.
You see – that 1982 recession never happened. And never mind the fact that the FED reversed course and expanded the money supply after this non-existent recession.
Kudlow wants higher real interest rates, which will reduce investment demand. Kudlow wants dollar appreciation, which will lower net exports. We have a lot to be thankful for as the good folks at the Federal Reserve rightfully ignore the serial stupidity that permeates the pages of the National Review.