Irrespective of whether inflation is feasible in the real world, financial markets are not time-telescopes. They do not read from the future, but only from present anticipations of the future. So if a flawed model is prevalent, it will show up as inflationary expectations.

IOW, when there's smoke, there's fire ... but sometimes its not smoke, its just a dust cloud.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.