With the share of USD held in foreign Central Bank reserves shrinking from 73% to 63% simply because of the loss of value I am beginning to wonder if Bernanke’s printing is finally starting to catch up with price deflation and deflationary credit contraction. If I’ve got the facts right (net consumer debt repayment, continually rising unemployment etc) it really does seem so.
Thoughts, anybody?
CPI has actually increased in the past months. There is general price inflation.
Things are catching up with Bernanke but it isn’t inflation. Big Ben and Big Al brefore him have already created the inflation and now we are seeing the effects of lower money values on debt held by foreigners. And unfortunately, in an effort to prevent “deflation”, lower asset prices caused by previous inflation, the US central bank has been creating money never seen before. And what is happening is that we are seeing recovery of certain asset prices with the losses being seen by holders of US currency.