Thursday, February 2, 2012

Retail Sales Climb 4.2% in January; Keynesian Forecasters Pummeled

Major chain stores posted an impressive 4.2% sales increase in January compared with the same month a year earlier, handily exceeding Keynesian analysts' expectations of a modest 2% rise.

The Keynesians have no clue. With this kind of activity at the retail level, price inflation at the consumer level is very near.

Anecdotal evidence from an annonymous commenter yesterday:
rw, I have doubted you so far, but after this month I have to re-think everything. My company gets most of its work from the deal flow in the PE market and until now its been a trickle. This month, it seems like 2006 all over again. It seems the deal flow is going to pick up with a vengeance in 2012. I don't know if that's good for the guy in the street or if I am just one of the limited beneficiaries of fed money printing, so I'll keep my joy over this contained to this post.. I know when I talk to my brother who has a business in the trades, things are still very slow and he has no pricing power.
Note to anonymous: Private Equity is, of course, a very early beneficiary of Bernanke money printing, but there is so much new money out there it will impact everyone. Your brother will eventually have "pricing power". Hell, everyone is going to have pricing power, It's called price inflation.

1 comment:

  1. "To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble." Krugman, August 2002.

    Here Krugman cites the logic of Mises/Hayek when it comes to a manipulated bubble by a Central Bank.

    So the manipulation can lead to a bubble, but the manipulation cannot cause a burst or a recession/depression?