From “Hawkins’ Eye On The Market”, by Genevieve Hawkins

Here’s something to ponder, other than the overhyped swine flu pandemic: if flooding the market with liquidity is supposed to lead to hyperinflation, why haven’t prices on goods and services started to skyrocket yet? So far Ben Bernanke has injected over $1 trillion into the markets, and Congress has had to raise the debt ceiling to keep the accounting in line. The infusions of cash were becoming so routine that they weren’t always reported, except by angry political commentators ranting about how much future taxpayer generations will have to be paying for this.

Traditionally such an influx of money might be expected to lead to Weimer style hyperinflation, where prices rise so fast that they could force a currency devaluation. Yet the March Consumer Price Index actually slipped 0.4% year over year, the first such decline since 1955. And a recent survey of small business owners found that none of them intended to increase prices in the near future.

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