Inflation has steadily declined for the last several months as energy prices have plunged, helping to curtail consumer costs. The inflation trend, however, could be heading the other way according to some economists.
Their worry is that current policy and massive government spending from the $800+ billion stimulus package will eventually lead to staggering inflation.
But 200% inflation? Marc Faber, author of the Gloom, Doom & Boom report, was asked that very question by CNBC’s "Asia Squawk Box." Faber’s response:
"Well, not yet. Not yet. But I think eventually. If I look at government debt in the US, and debt in general, I think the only way they will not default physically on their debt is to inflate."
According to Faber, the U.S. is pursing a monetary policy not unlike that of Zimbabwe, whose economic policies led the country to an inflation rate of several hundred million percent.
For an interesting perspective, follow the CNBC article US Inflation Could Hit 200%: Dr. Doom and watch the included video.