Bubble, Bubble, Everywhere a Bubble

There has been more important and interesting economic analysis that has come across my desk in the last few weeks than at any time I can remember. I have spent a lot of time pondering the meaning of several very different items, and trying to see how the dots connect. I think it will give us some clues as to what our investment posture should be. I think you will find this letter to be much different from the usual economic analysis.

First, I have masochistically thought long and hard about Greenspan's recent speech in Idaho. Most of the analysis I have read seems to say that Greenspan was saying: "...

Yes, there was a bubble in the stock market, but how could we have known it at the time? and; Even if we did know it, tightening the money supply to bring about a recession as a way to pop the bubble would have been unacceptable, and further; The mission of the Fed is to control inflation and to provide stimulus to promote growth in times of weakness, therefore;

"The…