- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Contraction leads to deflation
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Re: Contraction leads to deflation
There`s a "crisis worse than ISIS", that`s the derivatives mess. The 'too big to fail banks" aren`t going to be bailed out by a president Hillary..well of course not, the depositors of banks will shoulder that with a "bail in", thanks to the Frank-Dodd Act. This deflation Kabuki dance that has everyone laughing at the hyper-inflation prognosticators while they fill up with $1.50 gasoline is just the calm before the storm. I think yes, they can auger this pooch into the ground and Saudi can be the last man pumping $20 oil. But, some liquidity is going to have to be put into the market, or we will have a flat out 1930`s depression.
Inflation is the last shell in the magazine, so it`s understandable that the fed is relucant to prematurely fire it. Maybe the smoke and mirrors can continue past 2016, maybe producer`s balance sheets can be bleed out into the end of this decade, I`m not going to be the one to put dates on things.