There are two viewpoints in the "hard money" school of economics—one predicts inflation, the other predicts depression. I think they are both right, and wrong. I think stagflation is the most likely outcome. But as Yogi Berra said, "The future is hard to predict because it has not happened yet." When the crisis comes in 3 to 7 years, I cannot begin to predict which option the "powers that be" will choose.
The blog post for today is an interview I saw from a member of the hyperinflation school—John Williams from shadowstats.com. He points out in this clip that while inflation is currently calculated at 2%, if the same method was used today as was used in 1990, the inflation rate would be 5%. If the same method that was used in 1980 was used today, inflation would be 7%. There is an almost constant pressure on the average person as their income is not going up by 7% a year.
Personally I expect "modest" inflation in the 10 to 20% range while unemployment goes up. I know this is supposed to be impossible based on the Phillips Curve, but I think it will happen.
Yes there are people who are more pessimistic than me! Here is one: