Blonch

As a result of my age, I first became aware of government influences on the market in the 1970’s when we had inflation accompanied by stagnant economic growth, termed “stagflation.” Three administrations (Nixon, Ford, Carter) tried various solutions with poor results until Reagan simultaneously applied the brakes to inflation (tight money policy) and the gas to the economy (low taxes). Our current economic climate seems precarious and the government is striving mightily to influence it for good. We have interest rates pushed down by liquidity and money forcefully flowing into the system. The government is putting capital into failing businesses and trying to protect home owners. They are more worried about stopping freefall and preventing deflation and no longer worried about inflation.