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[quote=Anonymous][quote=Anonymous][quote=Anonymous] [quote]

Hah, no. QE bubble will result in either housing crash or mad mad inflation which deflates housing prices in nominal terms.  Honestly, I expect the inflation.[/quote]

Welcome back tin-foil hat wearing, QE man.

So, inflation will deflate housing prices in nominal terms (that's a quote!)? It doesn't take a professional economist (despite me being one) to tell you that you don't understand the words you're using. [/quote]

As a professional economist, you foresaw the housing bubble in 2005/2006? Because I did, long before it was cool.

I am not as sure about this one, honestly.  But things are definitely funny and all this intervention is... troubling.

No need for name calling, though as a professional economist who seems to take this discussion personally, do you work at the Fed?  You can tell Yellen she has a fan here! I think she is going to really shakes things up to get jobs growing again.[/quote]

Not personal at all. I was just trying to emphasize that the statement "inflation causes nominal prices to decline" made no sense.

No, I didn't even remotely see the crisis coming. To be fair, I wasn't looking, but I'm not naive enough to think that I would have spotted it even if I was looking.

I think it's odd that you think QE propped up the value of housing but not the value of other assets. That may be correct, but you're walking a fine line in order to get to this conclusion.

Finally, again, the taper should curtail the inflationary headwinds. You seem to believe that the taper will exacerbate inflationary headwinds. Regardless, the real fear, unless you're in a developing market (or invested heavily therein) is deflation. The Fed would like to see more inflation than we currently see. The fact that inflation remains so slow despite so much stimulus suggests there remains significant weakness in the economy. That's a real concern.

My guess is that when all the dust settles, perhaps by 2020, we'll recognize this period as akin to the Great Depression. We may well marvel that things never got worse than they did. [/quote]

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