THAT'S WHAT YOU GET...EVEN WHEN YOU ONLY PRINT MONEY FOR THE "PRODUCTIVE" RICH AND CORPORATE SECTOR...
WE THOUGHT THAT THE CHINA DEFLATION AND THE COLLAPSE OF LABOR UNIONS WOULD PROTECT US FROM PRICE INFLATION...AND IT DID FOR A WHILE. BUT AS USUAL...THE FED OVER DID IT...AND PRINTED MONEY WITH RECKLESS ABANDON FOR THE "GOOD GUYS" ON WALL STREET... AND NOW THE COLLAPSE IS COMING...
YOU SEE...EVEN THE "PRODUCTIVE RICH" AND THE "GOOD GUYS" ON WALL STREET HAVE LIMITS ON THE AMOUNT OF PRINTED MONEY THEY CAN SUCCESSFULLY ABSORB... THE EXCESS LIQUIDITY HAS PRODUCED MASSIVE ASSET INFLATION...EVEN WHILE GLOBAL WAGE GROWTH HAS PLUNGED.
WHERE WAS THE FALLACY... WELL, AS I'VE INDICATED ALL ALONG...IT'S IN THE NOTION THAT "ASSET INFLATION" IS GOOD INFLATION BECAUSE IT ONLY GOES TO THE "PRODUCTIVE" RICH...
IN TRUTH...INFLATION IS INFLATION IS INFLATION...
NOW THE FED HAS ITSELF IN A POSITION WHERE THE STAGNATION OF THE ECONOMY FROM EXCESS LIQUIDITY HAS REMOVED LOWER RATES AS A TOOL AGAINST RECESSION...
THE DOLLAR HAS ALL BUT COLLAPSE...
AND THE ONLY WAY OUT IS MUCH MUCH HIGHER RATES IN THE FACE OF A SLOWING ECONOMY!
IN OTHER WORDS...THE 1970's REDUX!
