The chatter in the financial columns has turned from trumpeting the economic collapse of the developed world to predictions of Zimbabwe-style hyper-inflation.  I suppose there is a certain logic to these predictions, after all, we have flooded the economy with dollar bills in unprecedented fashion.  Of course, there is the usual blather from the conspiracy theorists who are convinced that our recent problems are self-inflicted at the hands of the Federal Reserve Board.

But the world has not ended yet, and there are tentative signs some sort of recovery is developing, though I think it is premature to embrace any sort of “green shoots” view of our economy.  I think it is safe to say that things have stabilized some, and leave it at that.  The folks at CNBC are upbeat and gushing good news, as usual, and the market has recovered a significant amount of ground from the bloodbath of late last year and earlier this year.

But therein lies the rub, economists are a bi-polar bunch(at best) and have stratified in their predictions of either dire consequences in the economy or a view that envisions a healthy but gradual recovery is under way.  Since the eventual outcome probably lies somewhere between these two choices, ones finds himself scratching his head.

Are we in for a raft of hyperinflation?

In a perfect constellation of horrible circumstances, it is possible.  But my gut feeling is we will get some inflation and the Fed will begin the process of raising rates to combat the problem.  It is a ticklish paradigm, though, as it requires perfect timing, something the Fed has never been adept at pulling off…not that anyone can know until “after the fact” whether a rate adjustment is properly timed, and hindsight is always 20/20.