Wednesday, June 3, 2009

Pitchfork watch

I previously noted that Simon Johnson, the former chief economist at the IMF, wrote that “unless the government of the day is willing to take on the entrenched elites [read Wall Street and hedgies] and force them to take the pain, the path of least resistance is rising inflation and possibly hyperinflation.”

Social backlash?
Back on May 3 I wrote that the New York Magazine reports a quote from a Citibank executive as an illustration of the culture of entitlement:

No offense to Middle America, but if someone went to Columbia or Wharton, [even if] their company is a fumbling, mismanaged bank, why should they all of a sudden be paid the same as the guy down the block who delivers restaurant supplies for Sysco out of a huge, shiny truck?
When I start seeing items like this in the popular press, there is little question that the social backlash is starting.

1 comment:

spragus said...

A couple of points that may be closser to some of your recent articles, but which you eferece here.
!. Simon Johnson is on the right track.
2. And here we go a bit further afield.
The recent collapse of the US$ is a function of the decline in the US $ swaps arranged by the FED with other central banks. Just as the previous run up of the US$ was a function of the FED putting on the US$ swaps. (In my opinion).
Hence the inflation outcome is less obvious than some may suggest (at least in the short or intermediate term.)