- Current Conditions Summary
Public spending is out of control in the US and UK.
Banana Republic charges are being leveled at the US and UK.
Runs on the bank occurred in the US and UK.
The Fed is accepting mortgages as collateral in the US for the first time.
Foreclosures are at all time high in the US.
The US dollar is at all time lows.
Japan is still struggling with deflation.
Two failed banks in Germany were bailed out by the ECB.
There are US Congressional threats of tariffs against China.
There is a proposal to freeze short term commercial paper for up to 7 years in Canada.
Housing bubbles in the US, Spain, and Australia are deflating.
Housing bubble in Canada is still inflating.
China refuses to float the RMB and sterilize US dollars flooding in. That in turn is fueling Chinese inflation.
Price controls that can't possibly work were implemented in China in response to Chinese aforementioned Chinese inflation.
Commodity prices are soaring.
Oil is at record high prices.
A Massive carry trade in Japan is fueling a plethora of asset bubbles around the globe.
$500 Trillion in derivatives are floating around dwarfing the size of the global economy.
The global credit bubble dwarfs by orders of magnitude the credit bubble preceding the great depression.
Other than the above, the global economy seem pretty normal and rather well balanced. It's a tribute to just how well central bankers have done their jobs.- Mish
A great post and one that captures clearly the Economic Disconnect that this blog is focused on.