Morgan Stanley says lower-quality stocks and commodities will struggle during heavy fiscal spending
by Steve Goldstein
Market Watch
It was Nov. 2002, and then Fed Gov. Ben Bernanke delivered an interesting speech. Titled, “Deflation: Making Sure ‘It’ Doesn’t Happen Here,” in a speech in which the future Fed chief referenced Milton Friedman’s ‘helicopter drop of money,’ he argued for a range of policies including Fed-financed government spending to ward off deflation, were it close to happening.
Then, Bernanke noted, gold traded at $300 an ounce. Last week, gold reached a new record high of $2,619.90 an ounce. That is better than the S&P 500 since Bernanke’s speech and most other assets as well.
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