No rate increase in sight

• March Employment Report: 216,000 Jobs, 8.8% Unemployment Rate – CalculatedRisk
• Inflation? Not in Wages – Economix
• Debt, Deleveraging and Demographics Mean Great Depression Ahead, Dent Says – Yahoo finance

Dent’s unoriginal take is that housing will behave just like Japan’s did after peaking in 1990.  Prices won’t come back for a couple of decades.

If we get a major war in the next three years as Charles Nenner and Gerald Celente expect, we will have what I call “stagflationary deflation”:  sectoral supply-shock price increases that further squeeze nominally unchanging household budgets (at least for the bottom ninety percent).  Consumption at seventy percent of GDP is unsustainable, and what is taken out of consumption would be replaced with war spending.  Consumption would be effectively if not administratively rationed.

“Inflation is always and everywhere a labor market phenomenon accommodated by loose monetary policies.”