Deflationary Spiral…..Could a Bond Bubble be ready to Start ?

As the market digests a little Iraq based oil inflation scare for the next month or so it might be good to look ahead to what really is going on in the economic front.

To me Fed Taper is a sideshow.  The Fed knows but is afraid to say that QE+ has not had the effect they hoped, other than on the stock markets.  Economic growth is weak, my guess is that the GDP number for all of 2014 will be under 2.0 percent.  No doubt the problem since the crash has been structural and for that we can thank a sit on your hands congress and a corporate culture that puts profits before National well being.

A little primer here on the basics of a deflationary spiral.

https://www.khanacademy.org/economics-finance-domain/macroeconomics/inflation-topic/deflation-inflation-scenarios-tutorial/v/deflationary-spiral

For the stock market, declining profits will be the key market mover.

 

 

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