Thursday, July 3, 2008

The End is [not] nigh...this is the beginning

Definition of Stagflation: A condition of slow economic growth and relatively high unemployment - a time of stagnation - accompanied by a rise in prices, or inflation.
Investopedia Says...

Stagflation occurs when the economy isn't growing but prices are, which is not a good situation for a country to be in. This happened to a great extent during the 1970s, when world oil prices rose dramatically, fueling sharp inflation in developed countries. For these countries, including the U.S., stagnation increased the inflationary effects.
clipped from

Dean Gulis, a fund manager at Loomis Sayles in Michigan, said: "I don't expect this to be the end.

"Stocks have been trending down now for basically a year. They're going to keep struggling for a while.''

Many experts also expect oil prices to receive a lift today from the European Central Bank's likely decision to raise interest rates to 4.25pc. The move may further weaken the dollar and prompt investors to buy oil contracts as a hedge against inflation.
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