Wednesday, August 10, 2011

If I Were Chairman of the Fed

By Bob DeMarco
All American Investor

As the world watches London burn under the strain of economic uncertainty, Edelman warns it could happen here: "I think that you should watch very carefully for the possibilities of social unrest in this country unless Washington wakes up," he tells Big Think. It is already becoming a global conflagration.

How bad is our current predicament in the U.S.? Edelman tells Big Think:

If inflation is 2 percent but 60 percent of the inflation figure has to do with labor, who of course are shrinking in terms of salaries and income, then inflation is actually 6 percent. If inflation is actually 6 percent, and I think it’s more than that, and, at the same time, growth is 2 percent, we are in a recession.

Instead of remedying that situation, Congress's spending cuts will paralyze future growth and "will drive the economy into the kind of recession or depression that we had in the 1930s."

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Original content Bob DeMarco, All American Investor