Denninger is a deflationista to his very bone marrow.
When you see prices at the grocery store actually going DOWN across the board, Denninger will have started being right, finally. Unfortunately that is likely to be a while yet. There is still a LOT of 'trash paper' out there that the Fed is going to monetize- starting with the Fannie and Freddie bailouts, which are yet to come. They indicated their chosen path with the Bear Stearns fiasco, guaranteeing $29 billion of the $30 billion sum that "rescuing" B-S cost J P Morgan-Chase. Since then they have opened the discount window to all and sundry- EXCEPT John Q Public, of course.
As I have said before- we have embarked on a journey from "too big to fail" toward "too many to save." We will reach a financial and economic disaster along the way due to the rampant monetization of bad mortgages, bad car loans, bad credit card debts, failing banks, etc. You the taxpayer will be on the hook for all the bad decisions of banksters and loan officers across the nation, and YOU will pay the price for postponing the collapse of GSEs, banks and businesses. It is inevitable given the present course of action.
Therefore the Greater Depression will be HYPERINFLATIONARY... but the aftermath will be deflationary, Denninger will eventually be right.
dd
