Christina ... you might want to Google some articles about how arterial 'inflammation' plays into the circulatory system game. There is a community out there that feel inflammation is the real cause and cholesterol plaques out as a result ... like albumin in egg white coagulates as a result of heat in your frying pan. I am not a med expert at all, but with a family history of circ pbms and high chol, I have been following the arguments on both sides. As an engineer and investor, I have seen many conflicts of interests and it seems like the pharma companies have been leaning more towards drugs that require "forever" doseages versus "healing" doseages.
Just one contrarian's viewpoint. Best of luck to you.
T

As Bill Bonner et.al. point out the money presses are (in a sense) working overtime to inflate the debt away (I've also been blogging this point for the last 18 months now). Nominal consumer prices are therefore on the increase. As most commentators here has said (for the past 18 months) the end result is likely to be a long term L curve for the world economy.

Unpackaging this scenario to predict the stagflation impact on various asset class values and consumer price baskets will require more analysis. Collateral damage associated with dramatic up and down shifts in relative prices will be high.

Dan is also on the risght track.

Ps- if you ever see anyone slurring their speech and confused, or cant talk, or even walking a bit funny, call an ambulance as it may be a stroke. Thanks goodness I knew that. A stroke is not always someone clutching their chest and falling to the ground - the only symptoms (like with my Mum) can be slurred speech and then hardly any speech, and a bit confused. I just thought I'd tell you all that stuff I just learnt so it can help someone else.

“Depressions are monetary phenomena caused by central bank issuance of excessive credit. In 1913, the newly created US central bank, the Federal Reserve, began issuing credit-based money in the US. Within ten years, the central bank flow of credit ignited the 1920s US stock market bubble; and shortly thereafter, following the collapse of the bubble in 1929, the world entered its first Great Depression in 1933 [sic].

[The ‘suspension’ of the gold standard during WW1 played a major part in the credit expansion of the 1920s].

“Investment banks are the undoing of central banking. While all banks, central, commercial and investment, view credit as the opportunity to exploit society’s growth and productivity, investment bank exploitation of growth and productivity exposes society to extreme risks—for investment banks use society’s savings to make their volatile and speculative bets.

“The speculative risks undertaken by investment banks is done by leveraging the savings of society; and, when investment bank bets are sufficiently large enough and the bets go bad—as they inevitably do as the luck of investment bankers is due more to their proximity to credit than to their ability to foresee the future—it is society that will bear the brunt of the pain in the loss of its savings.

“Inevitably, investment bankers cannot resist the temptations of excessive credit and, like the buyers of teaser-rate home mortgages, they will always overreach themselves—an overreaching that will have disastrous consequences for the society whose savings they bet.

“The leveraged overreaching by investment banks in the 1920s caused the Great Depression of the 1930s and their more recent overreaching in this decade, the 2000s, is about to cause another Great Depression in the next, the 2010s” (“The Great Depression of the 2010s”, news.goldseek.com, May 5, 2008).

When the argument is presented that ‘central banks’ can prevent ‘depression’ the best analogy, for me, is ‘alcohol’ at a ‘social’ party. What ‘alcohol’ is to a ‘social’ party ‘credit is to a ‘financial’ party.

The social party begins and the guest start to imbibe. They are having a good time and so the alcohol consumption is increased. The party is ‘alive’.

A few hours later the guests have had enough ‘alcohol’ so that they can’t consume any more - they have reached the alcohol saturation point - so the party begins to wind down and some of the guests begin to leave. While some may continue drinking the rate of consumption begins to taper off.

But if the host wants to keep the party going and the guest to stay no matter how much more ‘alcohol’ he provides he can not tempt the quests to keeping drinking - the party is over.

So it is with ‘credit’ at a financial party. When the debt saturation point has arrived no matter how much credit is provided the ‘credit’ afflicted guest cannot stomach any more - the party is over.

The three great fiat systems, that began as a result of war, that preceded the present one, eventually ended in deflation, after the post-war bubble economies burst. The post-Cold War bubble economy will deflate and the fiat system introduce during the Vietnam War, a theater war of the Cold War, will have no different outcome to the ones that preceded them - deflation.