[quote=AN][quote=Arraya]I think prices will get cut in half again.[/quote]
I’d love to see that. I doubt it’ll ever happen though. If it does happen, at least 50% of us probably won’t have a job and the other 48% won’t be able to buy the house anyways since it’ll be cash only deal.[/quote]
The all powerful Oz that is the Fed is not as powerful as you think, much like the movie. I’ll say it again, you can’t just wave a wand, print some digital dollars and make a credit collapse that dwarfs that of the great depression go away. Though, you can delay it at the expense of more public debt.
Right at the beginning of the great depression the vast majority of analysts were calling for inflation as well, because of all the printing they did. One cannot print out of the liquidity trap. Deflation will run its course, and that will take a long time as deflation and depression are mutually reinforcing. When it is over, then we could see hyperinflation, but that is a few years(2-4) away at least. Unless, the world mutually agrees to not use the current financial world financial order, which would be a systemic collapse, chaotic and not associated with any “flation”.
At this point I don’t see that as a good strategic move because of vast dollar reserves and the desire to exchange them for something else before that happens. Right not it is just a bunch of lip service by our creditors as a power play.
The other interesting observation of the great depression is that, not for a second did main stream economists ever say anything but things were about to turn around. They did this for a decade until it did.
[img_assist|nid=12219|title=We are at return to normal|desc=|link=node|align=left|width=450|height=600]
Now, it looks like the current rally is over and we are getting ready for the next leg down.
