New Column Up at TheStreet: Restrained Rally Slowly Emerging

RealMoneyAs mentioned before, the full column regarding the rally is up, in the free section of, titled Restrained Rally Slowly Emerging

Regular readers of this blog will no doubt recognize most of the ideas in the article from prior discussions.

Here’s an excerpt:

"There’s an old saying: I cannot hear what you are saying, because what you
are doing is speaking so loudly. That’s my take on the Federal Reserve:
If it really believes inflation is so "contained" and "transitory," then why is
it hell-bent on tightening rates for the rest of our natural lives or until the
next recession, whichever comes first?

The answer, in case you haven’t been paying attention, is the robust
coursing everywhere through our economy, save for wages and
personal income.

Indeed, real wages are actually down 2.3% for the third quarter. Total
compensation costs (wages paid plus benefits) are down 1.5% on an
inflation-adjusted basis. That does not bode well for consumer spending into
2006. This comes when the consumer is running increasingly low on dry powder. As
we noted previously, the consumer is nearly — but not quite — shopped out.

Meanwhile, actual growth — and not the estimated, preliminary Commerce
Department’s GDP data — remains modest.

This helps explain why my bullish posture is short term in nature, and
measured at that."

That about sums it up.


Restrained Rally Slowly Emerging, 11/3/2005 7:19 AM EST

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