If you want to see what the face of stagflation looks like, and then extrapolate, you will be able to obtain a picture of what the United States of America is facing on this July 4, 2013. We're not far behind the scenes you are witnessing in Egypt as the 120 year Supercycle begins its final phase down. Because of our dollar and its reserve status which we enforce with 850 military bases in 145 countries, we are able to enter the hard down phase of a debt supercycle with an almost cavalier attitude to the pain that we are inflicting across much of the world. Of course there is pain here in tens of millions of households with over 100 million people living under the poverty level in the U. S. now. I listen to people with jobs and living in areas that are in a parasitic existence shielded from what is happening in many areas of their country and even in their own communities, and I wonder how much longer their illusion will last before the switch gets pulled. I don't have an answer, but the events that are occurring around the world seem to be accelerating like the inner wall of a hurricane with our country in the eye.
If you are even half alive, and you are paying attention to earnings then you must be able to see that our faux recovery is running into a wall. Companies are now missing on the top line AND the bottom line (which is REALLY easy to hit). Earnings are the life blood of an economy and in spite of the manipulation companies use to mask their problems, eventually certain truths on earnings will be exposed and that is now beginning to show up in spades. Changes in trend with no where to go for the ponzi do not bode well for our future.
Tapering? Really? You expect to pull back the printing machine and the bond buying as your economy is careening over the cliff. Maybe they will. But if they do you can be DAMN well guaranteed that they WILL print even more when the results are realized. Of course it may occur as printing through a new and improved means such as PTUP monetization....also called Print Till U Puke.
Now lets go to the alternative. They really do stop monetization or at least really TAPER it in a meaningful manner. Then some of you will see true deflation/ Depression in a way that would fulfill a Stephen King scenario....replete with famine, wars, disease and despair. They know this and just don't want to wash the scheme in such a devastating manner, because it will result in chaos and sometimes chaos spin completely out of control. As good as they are, they have limitations. I can't give you a timeline but this cannot continue indefinitely and we are accelerating with almost weekly eruptions happening around the world. I'm not sure how much water is left in their bucket to put out these fires so put your fiat wherever you have decided it needs to be, but just be aware this game is getting long in the tooth. gl ponzi boyz and have a nice holiday for the U.S. readers...while the Indians and Chinese buy your gold......