Economist Joseph Stiglitz doesn’t think too highly of the green shoot talk either. On Thursday he told reporters that, “It’s not clear that the U.S. is recovering in a sustainable way”.  

Why should you listen to Stiglitz? Because he won the Nobel Prize for proving that the market isn’t always efficient. And here at Notes, we always have time for anyone willing to attack established wisdom.

Stiglitz says the US faces two distinct scenarios. The first is malaise, in which the economy just bounces along the bottom for the next few years. The second scenario is a W shaped recovery marked by another dip as soon as the government’s stimulus funds begin to fade, around 2011.

Stiglitz also believes the dollar is doomed in the long term. This is especially scary because he’s a member of the United Nations commission that will study the global financial system and currency regimes. This from Bloomberg:

“Whether or not they’re able to do it, the uncertainty today about whether they can do it can contribute to the weakness of the dollar,” Stiglitz said. “That’s one of the reasons there is increasing interest around the world in discussing alternatives to the dollar system.”

“In most quarters, there is a feeling we should move away from the dollar system. The question is do we do it in an orderly way, or a chaotic way,” Stiglitz said. “The size of the deficit and the size of the balance sheet of the Fed have just increased the anxiety and the desire that something be done.”

While some think it would hurt the U.S. to no longer be able to borrow cheaply in dollars, “that era is over,” he said. “We’re moving to a more multi-polar world.”

Between the fall of the Berlin Wall and the collapse of Lehman Brothers was “the short period of American triumphalism, where we dominated the global scene. That period is over,” Stiglitz said.

We’ve been harping on about the fall of the dollar for some time. A quick glance at this picture (hat tip, Charlesgoyette.com) will show you why.

Nobody can look at this chart and honestly tell us that the Fed is interested in price stability. The only things that stay stable in this country are crooked politicians, taxes and a banking cartel ready to profit at the expense of this once great nation.