HERE COMES STAGFLATION

Inflation isn't caused by the actions of private citizens, but by governments, by an artificial expansion of the money supply required to support deficit spending. No private embezzlers or bank robbers in history have ever plundered people's savings on a scale comparable to the plunder perpetrated by the fiscal policies of Barack Obama.

"Inflation isn't caused by the actions of private citizens, but by governments, by an artificial expansion of the money supply required to support deficit spending."

...sorry, but that's kinda retarded. If consumers don't buy, deflation will happen regardless of the amounts of money printed. The defaults are on the way, like it or not. The dollar is going to dive, and oil will go higher.

So we'll have to get to some real work.

"Inflation isn't caused by the actions of private citizens"

I agree with the other poster. This is a retarded statement.

Every time credit is extended to someone or some corporation, the overall "money" supply is increased.

This is what happened during the housing bubble: a bunch of people were given loads of credit.

The government claimed that there was no inflation throughout the bubble, but that was a bold-faced lie. The one thing that a huge proportion of the population was spending the most on was inflating rapidly. That's why they called it a bubble ... after the fact.

Sure the government had something to do with it by encouraging stupid lending and not providing sufficient regulatory control. But the credit that was created out of thin air ... things such as Credit Default Swaps ... were all the product of private industry.

That is why we are probably not going to see inflation for a while: because the balloon hasn't completely deflated yet. There are still loads of overvalued MBS's and CDS's.

If the government really wanted to get us out of this mess, they would have forced the immediate unwinding of MBS's and CDS's months ago. This would have resulted in many millionaires and billionaires going bust, but it would have stabilized the economy for the rest of us. Then we would be looking at a true recovery right now, rather than the sketchy up-down-left-right oddity that we are currently stuck with.

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