Busted: Bankers and The Global Economy

November 8, 2008

Where has inflation gone?

inflationary-dollarFor those that are wondering where all the inflation-talk has gone, look no farther than the back-burner economic news articles. In fact, Dallas Federal Reserve President Richard Fisher says that inflationary forces have vaporized. Don’t you believe it. Right now, the only concern is for the hope of stability and authorities are bent on that match. The economy is so depressed coupled with global recession that the immediate inflationary pressures have moderated. Other than housing prices, do you see any real pricing changes? Are prices down at all? America still has inflation, but hyperinflationary pressures have cooled.

securityWages are down. The middle class and below is suffering. America has stagflation, a nasty mix of inflation and a stagnant economy. What’s more, any measure of heightened inflation in the future isn’t being discussed with the idea that if we don’t talk about it, inflation won’t happen. The United States faces the same plight as Japan did in the 1990’s. However, right now, the U.S. dollar is not deflated in comparison with other benchmark currencies because of the global span of the crisis. Mr. Fisher says the dollar isn’t deflated, but admits that we will see “headline inflation.” Every measure taken in an effort to insure economic stability is destined to propel inflation to new heights. That isn’t now, so who cares as long as we can cool the heat now. This detracts from the idea that the United States has a major national security issue. ~ E. Manning

June 28, 2008

Global Storm Predicted by EU Bankers

Global confidence in banking has been breached as far as some European investment bankers are concerned. British-based Barclays sees a perfect financial storm on the horizon and a complete loss of credibility by the U.S. Federal Reserve. Barclays Capital has advised clients to batten down the hatches for a worldwide financial storm, warning that the US Federal Reserve has allowed the inflation genie out of the bottle and let its credibility fall “below zero”.

This is a strong admission for any banking institution. Most have quietly struggled while fearfully or relunctantly forging ahead over the last six months or so. Now, Barclays is not holding back on any punches.“We’re in a nasty environment,” said Tim Bond, the bank’s chief equity strategist. “There is an inflation shock underway. This is going to be very negative for financial assets. We are going into tortoise mood and are retreating into our shell. Investors will do well if they can preserve their wealth.”

Wow. The Royal Bank of Scotland has (more…)

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