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Stagflation: Rising Prices, Falling Dollar = Back to the 70s

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posted on Jun, 4 2008 @ 01:37 PM
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Stagflation: Rising Prices, Falling Dollar = Back to the 70s


www.washingtonpost.com

Prices have been soaring long enough and fast enough, economists say, that the nation is at risk of a self-reinforcing cycle of inflation like that experienced in the 1970s.

It is a risk Federal Reserve Chairman Ben S. Bernanke highlighted in a speech yesterday, saying that the falling value of the dollar can feed into inflation expectations, and that rapid price escalation, if sustained, "might lead the public to expect higher long-term inflation rates, an expectation that ultimately could become self-confirming."

For some businesses that already is the reality. Many companies making long-term investments are assuming that prices will rise at a pace well above that of the past 20 years, as they pencil in larger price increases for the supplies they buy and the prices they charge. Consumers are coming to take rapidly escalating food and energy prices for granted.
(visit the link for the full news article)




posted on Jun, 4 2008 @ 01:37 PM
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Well this is a no-brainer, frankly.

Look at the US economy: with a severely weakened dollar and the country with a dangerous real-estate bubble in the midst of unwinding, a massive national debt, a financial black-hole with Iraq war-funding, steeply higher imports and a much-reduced manufacturing base, and soaring prices for energy and food, the stagflation of the 70s actually look like the best we could hope for.

www.washingtonpost.com
(visit the link for the full news article)

[edit on 4-6-2008 by gottago]



posted on Jun, 4 2008 @ 01:42 PM
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reply to post by gottago
 


Thank Goodness! I need the gold I bought to rise!


Go down Dollar!!!



posted on Jun, 4 2008 @ 01:52 PM
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How ironic that it seems like the 70's again now that Barack O'Carter is preparing to enter the White House.
I sure hope, with all his inexperience, he has a plan to fix it all
If not, this country will be red, black and blue.

[edit on 4-6-2008 by Alxandro]



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