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Now live from Africa and co-founder and managing director of the Economic Cycle Research Institute -- make that very chaotic calling him.
The star columnist doesn't use economic -- she looks at the waves the flow of the economy got you got a -- file old school leading indicators look at.
I won't talk about this.
I think that the treasury had trouble borrowing money this week.
Not as many lenders showed opposite we would have more right.
And interest rates went up a little not -- but they went off in the trend.
The cycle got shoes all agree -- a great.
Now let's get a -- was because we're borrowing costs -- -- absolutely but we have to we're talking about two different time for -- to cyclical time -- -- There's the next few quarters may be up to a year.
A secular long term issue is many years 510 years and when you get into these deficit projections which are gargantuan.
Strains that credibility of how you're going to borrow at a low rate.
Well so much money -- view is a concern on with the actual tone.
Yeah I see rates going up racing mortgage rates going up in a terrible housing that I wouldn't say about that well.
Every single recovery brings with it higher prices that's because there's more activity more stuff going on and so.
Higher interest rates in the early stages of -- recovery.
Don't mean that you're about to go into a double dip their evidence of actual activity it's it's actually positive the same way.
You know that -- that other kind of higher prices when the recovery takes hold.
Art or are saying that there's actual activity going on so it -- a -- short -- right on Gaza and it doesn't mean that the recovery is -- design is a higher prices.
With activity but we're not seeing any wage inflation maybe wages are going to Dallas until we need to see that before Ben Bernanke companies -- -- hot now really of the you're hitting on a key point and it and it goes to the heart of what's going on little unemployment data.
-- I I said very quickly earlier that the unemployment -- peaked back in October that's true.
There's a story underneath that part of it is deflationary -- part of it is inflationary and the long term unemployed.
The six the people who were who've been out of work for six months or more these are construction workers people -- -- with the earlier bubble also manufacturing workers.
There's no inflation pressure there and that's 40% of the people who are unemployed at 80 inflation pressure in fact deflation pressure -- work for a lot less.
The remaining 60% of the unemployed.
-- who work in jobs like we work at night he had health care and finance and accounting other places on the they are seeing the unemployment rate dropped faster.
Right now than in the past two recoveries and that's more inflationary than you would assume.
Right so there's an underlying inflation there's a piece of it and so we have simmering inflation pressures which is a good thing.
Because a year ago you're worried about depression and deflation OK so this is better than that.
On the other hand you don't want suffer run away because of that runs away and you've got a really big debt you're in trouble a -- as -- company.
Is this just one week a trend make and no -- so we just this hasn't been that bad all along this is the first.
Probably this is the worst one we've seen in awhile sparked a seven year treasury auctions go you know -- anything normalized heroes are.
All that mean that you -- as of late affect.
There's a delay will look we have all kinds of -- and in different indicators so if the dollar was weak a year ago.
Now it's showing up and good exports.
If the dollar stronger now it'll maybe take the shine -- put some pressure on exports a year from now.
Well here's the story yet I could not for the last year -- volts -- ideology and my politics you know from the performance of the economy and the stock market.
I thought that this administration.
Would drive the economy down and draw the stock market down it did not.
Your telling me the exact opposite is true that in fact this administration has -- reasonable handle on the economy the economy isn't doing too badly.
And that unemployment is gonna come down hang on hang that's a bit of a 101000 or 111000 dollars justified hang on hang on as students of the business cycle as you as you mentioned earlier.
One of the things that we see is that the administration's.
They don't have as much control as is suggested.
Over the economy in the near term in the long term they have a lot of control.
They're they're guiding that they're they're defining the playing field you know what is the give and take between private and public sector what's going on with our budgets and and all these things.
But that's longer term stuff near term.
They get the credit or globally.
And in its in its both parts.
As of -- for where the business -- moving the business cycle in my estimation is much more powerful.
-- -- these things that go -- -- I've got a sum it up and you'll saying this economy keeps growing this year and it's about 3% to Obama well look it's slowing from the 56 and I saw.
I think you're gonna see sustained job growth of the really important takeaways no double dip in 2010 no new recession here longer term I have a lot of concerns Charles -- a quick comment.
I I agree with you a 1000% you know -- in his interest -- also when you talked about this recession in better than the last two with respect in the recovery yet.
I went back to the 1940s and usually -- -- the last two recessions before this one.
Unemployment peaked when a recession ended almost every time -- month or month later.
I don't know how that changed I think MB ER might have been influenced somehow but to your point I do agree and I think that two people missing out what they're afraid probably will come to fruition further down -- room.
All right so everybody else is wrong and I'm totally wrong what it was that was having my thoughts on your right puts early.
Thank you so that's I think that's a good point it's all about time this it is and I got a complete it will go about sucking up the wrong and I let -- didn't that set it up already.
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