Back to the future

From Newsmax:

Harvard�s Ferguson: Obama Leading Us Back to Carter '70s
In a scenario reminiscent of the �Back to the Future� movie franchise, a Harvard professor says that we�re close to being mired in the economic disaster of the 1970s, except that Barack Obama instead of Jimmy Carter is at the wheel as the country roars toward inflation.

Fueled by the oil crisis, government overspending, money printing at the world�s central banks, and chaos in the Middle East, inflation is poised to take off, says Harvard economic historian Niall Ferguson.

The world faces a �pretty inflationary scenario" not seen since the 1970s, he said. How bad did inflation make the �70s? Those who bought houses, or tried to, faced mortgage rates of 17, 18, and 19 percent.

Demand from China and fighting in places such as Libya and perhaps Saudi Arabia will pressure oil prices higher, creating a bearish environment, Ferguson told CNBC.

Add the huge deficits and easy money in the developed world and the result is inescapably �a pretty inflationary scenario," he said.

"Best case, we're about to rerun the 1970s, only with Barack Obama instead of Jimmy Carter in the White House," Ferguson said.

China is now the world�s major manufacturer, raising the ultimate question of when the dollar will lose its role as the reserve currency, Ferguson said. It takes a long time for reserve currencies to lose their status, since holders cannot all liquidate at once.

However, investors who hold dollar-denominated assets, such as foreign central banks, are likely to reconsider their position, he suggested, saying that there is "a sense around the world that exposure to the dollar has higher risk in it.�

Put Democrats in "progressive" Congress for a couple years and this is what happens. Put a "progressive" President in the White House for two years and it all falls apart. If we are going to stay Democratic, at least let it be someone of John F. Kennedy's caliber...