Seems basically unavoidable at this point that we will see major deflation/money supply contraction followed by nasty, nasty inflation and or stagflation further down the line.

This is based on such inconvenient facts as the crushing US foreign debt, official Fed Reserve inflationary monetary policies, declining baby-boomer population trends, gutted American manufacturing base, large trade imbalances, worldwide bubble fiat currencies, huge disparities in living standards etc.

We still have an enormous multi-trillion US debt bubble that has to pop – as all bubble eventually do – and then we will go through a period of basing where things seem bleak indeed. The trillions of fake dollars that vanished during the dot.com bust and now the current real estate bust have all gone to money heaven, and real estate will continue to fall much much further until it ultimately reverts to appropriate valuations again.

Hopefully around 2020 or so, the secular bear market we have been in since 2000 will turn around, and the remnants of the debt bubbles will have cleared. This could serve as the base upon which the next real economically prosperous phase might build moving into the mid century.

Trying to re-inflate the consumer debt based economy that produces nothing but internet mania and complex financial derivative securities will only kick the can father down the road so its hard to say when exactly things will finally wash out of the system.

Unfortunately, at this point I don’t see anything that will allow us to outproduce and out-compete with emerging markets in Asia and India. America has been at an apex since the 60′s and we are witnissing the decline now.

Not saying we are going to go from a first world to a third world country right away (or ever), nor will we never see large booms and bull markets again, but we will surely see a decline in the average actual standard of living in the next century as Asia/India see large rises.

In fact we have not seen wage increases in most US labor markets since the 70′s once you adjust for inflation. Hopefully that change someday, but I’m not crossing my fingers.

Bu such is the inevitable life cycle of overextended, complacent, and diminished empires that engage in endless foreign wars and currency fiat debasements. Witness Athens, Rome, France, Britain, and now America, among others.

Revolutionary breakthroughs in nano-tech or something that rewrites all the rules of history are wishful thinking I feel. And nothing we could do would change the major demographic trends the world is now undergoing.

I feel technology will continue to evolve and change our lives us in the coming century, but these will always occur within the larger context of demographic and economic frameworks which exist regardless of time and place. I’m confident that at least until 2050 or so the familiar framework of cultures and society we know will continue to dominate the US and the world at large.