My personal unfavorite is the advertising of features enabled by the hyper emulsification of "new and improved" ice cream that has it now composed mostly of a very much larger percentage of air... which seems it is perfectly apropos in relation to our discussion...
The point... is that the system DEPENDS on there being inflation... and control of the system depends on it.
They desperately need people to think "inflation"... as their control of the system fully depends on there being enough of a structured and accepted concern about inflation, because there IS a drum beat driving a sustained pace in inflation, that the risk of it justifies ALL of the expected market behaviors based on it... That is what has dominated our markets for the last half century and more... and that is still the whole focus of the Keynesian conception of the control structure... the "tools" they have to exercise control depend upon it being that way.
And, they're right... that even the experience of too much inflation is preferable to an uncontrollable deflationary depression... which Germany, until recently, has been hell bent on requiring that Europe will experience.
The conflict that exists... exists because the rules changes that have been implemented along with the repeal of Glass Steagal, etc., have gutted the structures that have worked to enable systemic stability. If you choose to be a cynic about it, you might choose to see it in starkly political terms... noting that Reagan "won" not just the Cold War, but the global political battle with his free market focused views. Since Reagan, those views have been wildly corrupted... as WTO is NOT about free trade, rather than managed trade, etc. The political opposition's greatest prior successes were under FDR, and in order to counter Reagan's free market based successes, they've helped enable a return to the situation that existed prior to FDR's reforms, in order to justify reinventing them along with a new effort or two in assertion of control. Often, the best way to destroy your opponent, is by allowing them a too free reign... which is why Democrats like Barny Frank willingly joined the "deregulation" frenzy, only with efforts structured in the WAY they structured them with designs to enable failure... which they're depending on... to justify "fixing it" in the way they'd prefer... which resembles nothing like the functional compromises with people who did understand market function that occurred in the FDR era. What we're seeing now is the natural consequences of purposeful policies intended to enable exactly what we see... for political reasons... with the dual element of stupidity paired with ignorance... pointing out the "be careful what you wish for, because you just might get it" problem.
So, the events of 2008/2009 were, as others have described it, a "financial coup"... the implications of which are not yet fully reflected in... anything...
The "news" that everyone appears intent on missing now... for a variety of reasons all of which are perfectly rational in the Wizard of Oz like reality we have in global markets, now... is that the Fed has wrested control of European interest rates away from the Europeans. The European reaction to that shift in responsibility has been consistent with our experience of Europe in the prior half century, when America steps up to shoulder their responsibilities for them... mostly... a huge sigh of relief. What that means is... quite a lot of things that no is going to be willing to talk about very much. Too much Emperor, and not enough clothes... so, divert your eyes.
Seeing that includes a huge potential for a couple of things to "surprise" the market... this spring... as many of the FIXED expectations for market failure, and momentum building behind that set of expectations that exist now, are conditioned by or based on the incapacity of or the expectation of massive dysfunction in the European institutions... which are no longer particularly relevant as anything other than as the conduits for enabling implementation of Fed policy.
The fundamental problem still is... the underlying economic and political reality has shifted dramatically since the end of the Cold War... and we're in a much different market reality now, one much like we'd see if all the wars and politics of the 20th century had never even happened... and, now, we're in a much different market CYCLE now than we were in the prior half century... so, we're in a commodities cycle now, not a credit cycle, in market parlance... and we're trying to navigate turbulent waters using a control set designed to work in a credit cycle.
We're seeing "growing pains" in adapting the Keynesian control structures to the underlying shifts in the larger cyclic elements... in a less Keynesian world... and the natural result of that is in the exercise of MORE control... as the systems exhibit dramatically less willingness to be controlled by the inputs that worked in the past...
But, oddly, the reality proves a convergence in interests that exists (or, that should exist... will exist, etc.) between the "evil doing banksters who control the system" and the gold and silver bulls who decry their evil control over the system...
Both really need for inflation to be the enemy... differing only in how much is "good" and how much they expect.
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