In my post, “Obama and Inflation in Zimbawe“, I predicted that at the rate the Obama is spending Federal funds, we would soon face inflation. Of course, that was before Obama unveiled his budjet with a projected $1.75 trillion deficit. The Chinese, one of the USA’s major lenders, is now worried. John Hindraker in the New York Post writes:
Of course, Beijing’s not worried that the United States government will default on its bonds. Rather, the concern, now being expressed openly for the first time, is that the United States will adopt the time-honored debtor’s remedy of inflating its currency and paying back its debts in shrunken dollars.
Hindraker’s article was first posted at Powerline.