At the end of 2008, total federal debt in the credit market stood at $6.4 trillion. At the end of 2012, it stood at $11.6 trillion, an increase of $5.2 trillion. Thus, on net, the credit market ex-federal debt contracted by $2.2 trillion. If it were not for the massive federal deficit, total credit would be contracting. We can see this change in the makeup of the credit market:
This is not the picture of a healthy credit market. Instead, it is the picture of a credit market where the federal deficit is the only thing preventing a full on depression. There is no inflation in the total supply of credit without the obscenely large annual federal deficit and the outstanding amount of credit dwarfs money supply.
Gold Lied, Inflation Died
The Market Will Soon Hit An Air Pocket And Drop 20% In A Matter Of Months
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Yesterday, in a presentation to investors, Dubravko Lokas-Bujas, JP
Morgan’s Chief Global Equity Strategist, called for an “out of the blue”
stock market c...
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