sbenard

All Signs Point to More Inflation

WE must remember that the deflation is caused by the popping of bubbles following inflation caused by excessive prices on a foundation of debt. Excessive debt causes inflationary bubbles, followed by deflationary popping of those bubble. If the Fed simply seeks to constantly reinflate those bubbles through excessive monetarization, then we end up in a constant boom and bust cycle. The most economically viable long-term growth comes when the government stops this boom and bust cycle by permitting free markets to work.