> surpluses are deflationary; deflation is desirable because it slows down
> economic growth. Slower growth means looser labor markets (less upward wage
> pressure). Deflation also is good for bond-holders. The bond market is
> much bigger than the stock market. >>
Do they like stagflation, though? That might well be the question du jour ... as rates seem bound to drop amidst prices that seem bound to rise.
Cheers, Rob.