The mainstream press is belatedly starting to talk double-dip in the economy as a near-certainty as opposed to the 10-20% likelihood oft quoted earlier. Of course, this outcome was predicted at the outset by independent observers on the basis that the best that the stimulus could do was to postpone the day of reckoning at huge taxpayer expense. So we may now be entering the same situation but with considerably deteriorated public/private finances.
With a few exceptions, most Central Banks and Treasuries around the world will nevertheless likely pursue the same discredited and philosophically and morally bankrupt policies of the past, so we can except Quantitative Easing 2 (QE2) and associated stimulus and bailout policies to emerge shortly. My guess is that the amounts involved this time will dwarf QE1 by a considerable margin. In the process, national/sovereign debts will skyrocket to new levels and the world's financial system and underpinnings will decay further and tremble anew. These folks continue to peddle the notion that the answer to problems created by excessive debt, leverage, fraud and make-believe accounting is even more excessive debt, rigged accounting and rigged markets, be it bonds, equities, real estate or commodities. Be very, very wary of all markets!
