Thursday, July 8, 2010

Inflation or Deflation

Many economists are worried about inflation. But others say they're looking the wrong way.

By Heidi N. Moore, contributor

The national knowledge is creeping in that the good times of the stimulus may soon be over. The United States is running an 11% deficit and our gross debt is 83% of our GDP and may rise to 100% in as little as three to five years.

So when we saw a recent note about the "Keynesian endgame" from Scott Minerd, the chief investment officer of Guggenheim Partners, we decided to pay attention:

"At its core, the Keynesian theory says governments should be called on to prime the economic pump as needed. This works as long as the government has the ability to borrow money. But what happens when a government can no longer borrow money?" (more)

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