Isn't inflation the obvious worry.

1) We are borrowing money to cover the Iraq war.
2)We borrow to cover the current accounts deficit.
3)The FED is printing money to bail out the banks in the current credit/liquidity crises.

This is putting more dollars into an economy that is not growing. What is the alternative to inflation?

ct, you'd have to admit thats a trickly lil problem that he has to balance. When the investment banks were allowed to go to the fed window last week one wonders how much vetting of those actual "assets" the fed did in order to give them credit. Its pretty scary to think about given Bear.

That tightening of supply will have to be at least a year off before we can begin to make real headwind against the economic slowdown. And next year is probably being generous.

American inflation may be an issue (the price of gas certainly will, but that most likley will be described as the result of sopeculation and the Middle East not inflation.)
Global inflation will not be an issue, for much the same reason global anything (with the very partial exception of global warming) never becomes an issue in American politics. People will look at whatever woes beset Africa, China or even Mexico and shrug, thinking "well, too bad for those people, but it's not our problem." In the case of China some people may even smirk about the trouble and figure "they" deserve it.

I remember that WWI all started from an assassination in an obscure little province somewhere in a podunk Balkan country in a little town that no one really cares about. Seems to me big events in history often start in small remote corners of the world over minor and petty issues and indifferences of one class to another.

As long as it is petty, we have nothing to worry about ... all problems start locally and stay that way as long as it doesn't grow legs and wings. It's those legs and wings I would be worried about.

Remember, the crash of 1929 was just one of many financial hiccup of that era until a bank, The Bank of the Americas (I believe) didn't have enough cash on hand to pay out to depositors wanting to withdraw their money. It caused a global panic cause some people, outside the US, mistakenly "thought" it was the US Treasury that couldn't meet its' obligations. That little event snowballed into the Great Depression.

Never underestimate people's rationale when it comes to fear, especially if it concerning losing something they value or treasure. Bu$h has mastered the technique in "his" war on terror..

It's not a currency problem. It's an oil problem first, a food problem second, and an overpopulation problem first, second, and third.

Bernanke might be able to keep our payments system up and running while housing deflates but he'll never solve this one.

Only the 4 horsemen can do that.

Re: The results might return farming to the center of the economy, where it was until mid 20th century.

Unlikely. There isn't enough land for everyone to farm. No, we're going to remain an urbanized civilziation for the indefinite future, probably relying on nanotech, biotech and more exotic inventions yet to come. To paraphrase the philosopher Whitehead, the future will not be stranger than we imagine, it will be stranger than we CAN imagine.
Also, if you're talking about America, the urba-rural changeover (and associated industry-farming changeover) came in at the end of the 19th century not the mid 20th.

Wait a minute...I don't know about the other countries mentioned by NYT, but Mexico didn't experience "food riots." There was a series of popular demonstrations against the price of maiz, directed against the Cauldaron government. That's not a "riot" at all. If it were a riot, Mexicans would have been shouting: "Give me tortillas or give me death!"

It's really irresponsible for NYT to characterize such as a "riot." Or many papers, for that matter. The UK Times says:

"The spectre of food shortages is casting a shadow across the globe, causing riots in Africa, consumer protests in Europe and panic in food-importing countries."

Note the language: "consummer protests" v. "food riots." If an Irishman throws a rotten potatoe at a member of the London stock exchange, it will be a "consummer protest." But if a Mende from Burkino Faso throws a rotten yam at a Monsanto executive, it will be an act of terrorism.

JonF31, to be at the center of the economy is not synonymous with largest population sector being in agriculture. For instance, the average percentage of household disposable income that goes to food dropped from around 22 percent in 1950 to around 6-7 percent now. Up to 1919, agricultural goods constituted 45 percent of American exports.

Of course, modern agriculture isn't gong to attract masses of people once again, but people may well become much more aware of agriculture if the percentage of household disposable income on it goes up. And given how little desire there seems to be for our manufactured goods, it doesn't seem absolutely out of the question that agricultural export could top manufacturing in the next couple of years.

Re: Good luck in imposing such policies.

The low birth rates are already happening spontaneously. Most notably in some of the very countries that consume the most goods per capita (Europe and Japan). America is a bit of an outlier, but mainly because of our immigrant population. And there are even third world countries (e.g., Mexico) where birth rates have fallen below replacement. The population bomb turned out to be a dud.

"Neobunghole." Clever, kid...clever.

I was actually addressing the question of whether or not we should use our critical skills when engaging media, or just remain a puttyhead and let it soak in, unchallenged.

I'm happy to see you've chosen you side, Offendi.