Kudlow: Why This Ain’t the 1970s

In his blog (check it out for the great charts), CNBC's Larry Kudlow forcefully explains why high oil prices don't mean we're headed toward a return to 1970s-style inflation:

Stocks and bonds are both telling us that this is not the 1970s.... In the 1970s, commodities and the 10-year bond rate both went up together. That was inflationary. Heck, bond rates reached around 15 percent at one point. They've been sliding down for several decades. Now commodities are booming, while bond rates are at rock bottom, hovering just above 4 percent.... Oil prices rose in the 70s. Stock prices fell. That was global inflation. That was high tax rates. That was crazy wage and price controls and over-regulation. Now look at the difference with the 2000s.... Stocks and oil are rising together. That is a global economic growth signal. It is not an inflation signal.... It's all about low tax rates worldwide. It's all about strong, global, free market capitalism creating high demand for commodities. Production can't keep up, that's all that's going on. That's why prices are high. This is not the 1970s. Not by a long shot.