About a year ago (or nine months ago, whatever) we had the Inflation or Deflation debate on Piggington. We agreed a recession was coming and the credit crunch was already evident. So people were debating on this forum if we’ll see an inflationary or deflationary environment.
I was rather made fun of for predicting inflation would dramatically accelerate. At that time few who frequent this forum were expecting Inflation would take off.
I do acknowledge the arguments of the Deflation camp are very sound arguments, well-founded in economic theory. The credit crunch, for example, is obviously a very strong deflationary shock.
Given the Inflation numbers over the last year, it is clear whose prediction was correct. We have stagflation, and it will get worse.
