Do you find it perplexing that the same people and institutions that told us that there was nothing to worry about, that the financial fundamentals were fine, and that there was no reason to be concerned about an economic crisis are the same people who are saying the worst is over, the recession has ended, and that their solutions to the crisis have worked?
We too feel completely baffled by this to and from. Who are we to believe?
When foreclosure rates rises another 17 percent, reflecting a continued negative (deflation) trend, and U.S. credit card defaults rising to record levels while at the same time the FDIC's Deposit Insurance Fund is now negative (did you know that in 2008 and 2009, 121 banks have failed?), how is it possible to say that the recession is over?
It is not. The second round of deflation is heading this way and it will continue its control of downward pressure over all aspects of our economy.
So instead of listening to the same people we've listened to before we should start paying attention to people like Nobel Prize winner and Columbia University professor Joseph Stiglitz, who warns that, "Deflation threatens the U.S. economy and that could be dangerous." Or Bill Fox, Senior Bonds Analyst at Elliott Wave International, who says in his article 'Inflation? Disinflation? In Your Dreams', "deflation will likely continue to exact its toll over the coming months as money supply and credit keep evaporating (along with hope)."
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