Don't for a Minute Think There Isn't Price Inflation at the Consumer Level

Increases in productivity, especially in the technology sector (See: cell phones, lap tops and flat screen televisions), have put downward pressure on some prices, but that doesn't mean ALL consumer prices are falling.

House rents are now climbing at roughly 3% on an annual basis.

The dip in rent growth during the Great Recession was likely the result of consumers increasing their desire to hold cash balances. This has obviously changed and suggests that prices of other consumer goods will likely start to accelerate.

The Fed can only get away with printing money that inflates only the capital goods sector for so long. If they print enough, consumer price inflation kicks in with fury.