Taken together, with the global economy in the ‘twilight zone’ and central banks still engaged in the great monetary easing, type II stagflation continues to rule supreme: economic ‘stag’ coupled with asset price ‘flation’. My only worry is that a positive outlook for risky assets is now pretty much the consensus view.
… U.S. 4Q is now only tracking at 0.4%, according to our U.S. team.
—Joachim Fels, Sunday Start, Morgan Stanley, December 2, 2012.
I just did an unscientific study of Politico above the iPad fold. I believe there was not one headline alluding to the present state of the American economy.
I agree we are all transfixed, aghast, at the cliff’s precipice. Some, not all, are and will get smarter at fiscal economics as we kick the Debt & Deficit into the summer, hence.
At the same time, the sub-2 percent feel of this economy, combined with Europe and other global laggards, makes for a challenging December.
After the recent CEOs-to-WDC charade, after the “theater” of post-election Washington, after the bipartisan smallness-of-vision, do any of the elected few actually care what is going on outside 20003?
Dis-aggregated, what portion of America is now in recession? 70 percent?
What a disappointing weekend of political blather.
December arrives; 2013 beckons. We stagger forward in our economic Stag and our asset-price ‘Flation. Discuss.