Many pundits are coming to the stagflation scenario now as an
explanation of recent market and economic events.
Of course, it could be just garden variety PLUNGE PROTECTION. Per
usual. Consider:
CLEARLY, THE FED MUST CONTINUE TO RAISE RATES;
But, to do that, an not admit that the last 10 or 20 years have been
a TOTAL fraud, it's necessary for the economy to be seen to prosper
and jobs pick up.
Now, we all know that the jobs are not going to pick up, and that
debt is going to be a big burden going forward;
SO THE ONLY PLACE FOR THE REQUIRED "HAPPY FACE" IS ON WALL STREET.
HENCE, THE HUGE STOCK RALLIES OF LATE;
This kind of market manipulation is not new. It was used all the
time during the bubble to keep the HAPPY FACE in the news and in the
public mind.
SO;
WITH OIL SOARING AND INTEREST RATES GOING UP?
LET'S HAVE A BIG FAT STOCK RALLY LIKE IN THE OLE DAYS!
Now there are more convuluted ways of looking at this;
Perhaps the INFLATION IN OIL AND OTHER COMMODITIES MEANS THAT:
(Hang on to you hat)
STOCKS CAN ALSO RALLY, IE "INFLATE," AFTER ALL STOCKS ARE "ASSETS"
TOO!
AND IF YOU GOTTA HAVE ASSET INFLATION, WHY NOT INFLATE STOCKS ALONG
WITH OIL, GOLD AND THE OTHER STUFF!
ANYWAY;
The bottom line is that the wheels are finally coming off the economy.
And Mr G, history's greatest asset inflationist, will soon take his
place in annals of economic history; next to John Law, the South Seas
Bubble, the Mississippi Bubble, and all of the other
dismal "manipulators" and manipulations of money and expectaions that
the human race is prone to follow.
Indeed, the last 20 years will be seen, not as a New Era or New
Economy, but alas, just yet another example of THE MADDESS OF CROWDS.
