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<p>[QUOTE=&quot;Cloudsweeper99, post: 1285417, member: 3011&quot;]First let me say that I&#039;m not convinced that the money supply is actually shrinking, but it also probably isn&#039;t growing as much as the Fed would want.&nbsp; </p><p><br /></p><p>Interest rates and labor costs are a huge difference from the 1970s [I&#039;m not even convinced yet that there can be systemic inflation without rising labor costs].&nbsp; Food and energy are excluded from core inflation but not from the CPI or GDP deflator.&nbsp; The money in circulation declines when borrowing goes down, not because of payments to China.&nbsp; Remember, the money is the debt and the debt is the money.&nbsp; Reductions in outstanding debt have the same effect as reducing the money supply, and offset the Fed&#039;s effort at stimulus.&nbsp; I know the government is running up a lot of debt, but private debt reductions and defaults are cancelling a lot of it out to some extent.[/QUOTE]</p><p><br /></p>

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