From: Monte Davis 

"Geo"  wrote:

>Most of the inflation you see is the result of china coming online. It's not
>being caused by an overheating us economy. This is a huge point and a major
>difference from the last time we saw serious inflation.

I agree, and suggest that "inflation" isn't even the right word.
China's growth is pushing up prices the good old-fashioned way, by bidding
with real new wealth earned by selling lots of real goods. So it's not a
case of "more money [paper, fiat, bogus credit] chasing the same
amount of goods," which is what we usually mean by
"inflation."

We also do have some incipient inflation in the usual sense: the US
government and US consumers are spending beyond their means and filling the
gap with various forms of paper, which has expanded faster than the value
of the goods we produce. But that's quite distinct from the effects of
China's emergence as a new 800-pound gorilla in world markets.

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