Tuesday, October 28, 2008

Down the financial road

A "traditional" "great depression" combines high unemployment, negative inflation, and a stock market slump.

My fear/suspicion is that we're not in the middle of that. This link captures my notion that the stock market slump is just a prelude to serious inflation. The counterargument would be that sucking $20 trillion+ out of the economy through stock market and housing losses would more than compensate for any inflationary pressure from a $2 trillion rescue plan.

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