The central bankers have no other policy than to support asset prices. They have elevated and taken control of markets beyond the point of withdrawal. There is no way back.

Since 2007, global bureaucrats have attempted to ward off the inevitable. Attempts to prevent a euro eruption have become preposterous. A week does not go by without the the European Central Bank (ECB) reducing its standards of collateral.

The world is undercollateralized. This is the single most important feature of the 2011 economy. Sixty years ago, if assets were worth less than loans, it was possible to work our way into the black. In 1950, 59% of US corporate profits were from manufacturing; 9% were from finance.

When inflation is rising, it is necessary to take matters into ones’ own hands, or, get crushed. Those who remain whole during inflationary periods act early. What follows are summaries of recent quarterly earnings reports. Most of these companies have headquarters in the United States, although they buy and sell worldwide. The key take-away is that inflation is a major burden.

On January 7, 2011, Kelly Evans of The Wall Street Journal interviewed former Federal Reserve Chairman Alan Greenspan. He rooted for the stock market. Greenspan’s circular logic was unenlightening: “Stocks are cheap if earnings are to continue higher.” Taken as a whole, this does not mean much, akin to prophesizing: “The Red Sox will win if they score more runs than the Tigers.” Greenspan’s successful impoverishment of the American people often hinged on the suppression of his dependent clauses: “Stocks are cheap,” was all we needed to know.