Wall Street Wakes Up to Inflation
As I have been suggesting for two months, the possibility of Stagflation is real. This morning Wall Street woke up to a 4.3% year over year price inflation number. Many of you know I have great respect for Prof. Nouriel Roubini, who called the Sub Prime meltdown months before any one else. However, we part ways on the Stagflation debate. Roubini believes the coming recession will be so strong that it will lead to a “recoupling” of the U.S. and world (especially Asian) economies. This will lead to a global slowing that will reduce demand for oil and thus reduce inflation. But the figures coming out of the oil markets say that Asian demand for oil keeps growing even as the U.S. demand has slipped by 50,000 barrels a day because of our slowdown. This is only natural. Chinese car dealers sold 639,000 cars in the month of January.That was up 32% from that month last year. Indian car sales were almost as robust. Let’s not kid ourselves, Asian demand for oil has already de-coupled from the U.S. economy.
The question is not that the economy is facing a collapse, it is what will the America people do about massive unemployment, sharp increase in homeless families and lifestyles that can no longer consume?
Will we as a country seek to solve our self-created problems or will this be the end of America?
The big-banker Ponzi scheme is up. The Maestro’s golden boy cannot stop the impending financial havoc. Not since the days of Volker will we have seen such devastation and ruin. Hello double-digit unemployment, hyper-inflation, and mortgage defaults. Get ready for socialistic new New Deal expansion programs designed to enslave mankind.
Meet the new boss, same as the old boss.
[...] the rapidly growing Asian economies have decoupled from the recessionary problems of America. I have argued that they have, but Prof. Roubini has strongly suggested that we are heading into a global slowdown brought about [...]