If the U.S. continues on its current path, it will be experiencing full-blown stagflation by the time of the 2012 election. On fiscal policy, the only debate between the two parties is over how much to cut. At the same time, the Fed is going ahead with Quantitative Easing 2, which will expand the money supply and pump more liquidity into the banks. The policies of fiscal policy austerity and monetary expansion are leading us to the worst of all worlds: declining employment and wages coinciding with rising prices.
↧