Dear Sean -

In a message to Ian last week, I mentioned Bill Gross's (the world's biggest bond trader) October, 2004 monthly missive. In this opinion piece, Bill Gross argued that the US Goverment understates inflation (through hedonics & other statistical tricks) by 1% annually. Though he is now a pillar of the Establishment, I think that Bill (Gross) has never forgotten his modest middle class roots or his days as a Las Vegas blackjack dealer. Plus, he's a big Deadhead! (Grateful Dead Fan). If Bill (and you) are right, that would slash another 1% annually off US Growth. And yes, we could well be in a recession!

Sean, at the top of the American food chain, the system is juiced with cash. The Fed has been allowed to simply do away with the venerable "M-3" money supply figure and reports. What shocks me is that there is little question raised in the establishment media. How much money is REALLY being injected into the economy? Unless we're productive beyond measure, extra cash equals more inflation equals lower growth. Except, the Hogzillas who run the country and control establishment media want to keep this dishonest game going. Traditional investigative journalism is becoming an oxymoron. And, why should the Hogzillas give a rat's behind whether inflation is really 5% or 7%? Over the past 25 years, their asset & compensation gains have been nothing short of mindblowing. The question remains, how much longer can this feculent system keep rollong?

Dear Ian:

Thank you for your replies. I too recall that a number of establishment figures came down hard on Bill Gross. The reaction was almost as if Bill was a "traitor to his class" (a la F.D.R.).

And with good reason. If the American public even had a clue what goes into "their" monthly statistics (i.e., unemployment inflation, growth) well, you'd might finally get their rabid attention. I wonder how many people know what "hedonics" is, as it relates to economics, and our current national "prosperity". I'd love to see what would happen if you made the correct defination of "Hedonics" a neccesary condition to the admssion to a NASCAR race? Yet, it's these types of people who are being flayed alive economically!

And, again, the establishment "Hogzillas" don't care about the veracity of these numbers. They want the American public to accept these numbers as Articles of Faith; that way their investments keep growing to the sky and our (many) foriegn creditors are mollified.
Iraq? That's for someone else's kid. Their kids go to top private secondary schools and very selective colleges. About the only big problem I can see for these people is that Nantucket & the Hamptons are looking like Paradise Overrun these days. They're probably considering moving to North Haven or Vinalhaven, Maine ("the elephant graveyard of old money") though the elimination of the Inheritence Tax could make properties even harder to get there!!

Dear Sean:

Apologies for the name mix-up! Aspen is gorgeous this time of year and I was out late (for me) last night!

John