James Alexander Michie | The Spellman Report: The Inflation Divide

The economy is on a tear. There are many “next new things” coming to the marketplace, generating private investment to produce new goods that are in high demand. Firms that invest are seeing gains in after-tax corporate profit, thanks to expansionary fiscal policy from tax cuts and accelerated depreciation on new capital goods. There is also increased spending on military. And don’t forget deregulation, which is enabling businesses — especially small businesses — to thrive.

But the economic expansion has many observers spooked by the fear that booms will inevitably turn into busts, “just as they have in the past.” So today there is a growing chorus of observers expressing nervousness about the implications for economic and financial market performance. They do have a case to argue, as there is an endogenous mechanism that can turn an economic and financial boom into a bust. So how likely is that?

Here is the script — you decide whether to extrapolate it.

Read the full story here:
http://jamesalexandermichie.com/james-alexander-michie-spellman-report-inflation-divide/

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James Alexander Michie Blogger, a personal blog created by Michie, recently published articles related to Finance, Sports, Hockey, NHL, Travel, Photography, Random Musings.

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