Few are willing to acknowledge the threat of stagflation, but reports showing inflation rising more quickly than expected - even as growth is slowing - indicate that this scourge of the 1970s may be stalking the U.S. economy.
Every economic report nudges the United States closer to the definition of stagflation - a condition marked by slow economic growth, high unemployment, and soaring prices.
Although many economists believe the sluggish economy will moderate inflation, that's not what happened in the 1970s.
"The belief that you can't have inflation and high unemployment is nonsense; we had 25% inflation in the U.K. in 1975, in the middle of a recession," said Money Morning Global Investment Strategist Martin Hutchinson.
Hutchinson has repeatedly warned Money Morning readers that the U.S. Federal Reserve's easy money policies would lead to inflation without fostering economic growth.
In the past couple of months, Hutchinson's fears have been realized.
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