What you're seeing is that inflation is rising, ... It's still at a low level, but you know what the trend is. The question to ask is, How much is too much? At what point does the Fed say it's risen enough that we don't want it to go any higher? That's the difficult question to answer. |
You can no longer make the argument that there is a lot of excess capacity out there. The bias on inflation is a little bit to the upside and the Fed has to be careful about that. |
You could have dismissed it six months ago as a one-time hit, |
You have the Baby Boomers having the resources to buy condominiums, betting on the increase in value in the next six months, ... That activity may be the first to feel the crunch if the housing bubble bursts. |