Thanks to Junior Mogambo Ranger (JMR) Joseph Z., who sent the Bloomberg article of the National Weather Service saying, “The high in New York City today is forecast to hover around 80 degrees, making it only the second time on record that June and July temperatures failed to reach 90,” which I take as proof that the world is not heating up, but instead is cooling down.

Currencies trade in a tight range…Pesos, loonies and reals in the spotlight…The Mogambo on a Thursday!YAHOO!…Jobs reports dominate today & tomorrow…And Now… Today’s Pfennig!

What’s new? Nothing much…Markets still moving up…

Has the massive Obama stimulus plan put us on a collision course with virulent inflation? It sure looks that way. Let me explain …

Upbeat headlines have been everywhere in recent weeks, and they all seem to point to a single conclusion: The U.S. economy is in the early stages of a very rapid recovery.

We love surprises! But only when we see them coming. We’re always wondering: how will we be surprised? What will happen that we don’t expect?

The depression deepens. “These are not layoffs… they’re permanent job losses,” said Barry Rithotlz this morning. “These people are not going back to work anytime soon.”

America is witnessing a mammoth increase in the money supply.  According to the U.S. Federal Reserve, seasonally adjusted M2 has gone from $7.25 trillion in July of 2007 – to over $8.37 trillion today.  That’s 15.44% more money circulating around the economy in just two years, a colossal $1.12 trillion increase.

The Fed is flooding the system with as much funny money as it can. US monetary base has shot up by over 100% this year. It’s the largest increase in 50 years by a factor of 10. This build up of freshly printed dollars threatens a dangerous inflation… but not yet.

Waterford, Ireland

Our faith is weakening. That is, our faith that the government will be able to cause inflation, sooner or later. Let’s review our own narrative: deflation now, inflation later.