Economist Gary Shilling says the US is now on the path to serious inflation

Economist Gary Shilling says the US is now on the path to serious inflation. Everybody is worrying about the Fed tapering, but this only concerns an initial small reduction in the $US85 billion per month in securities and Fed purchases, most of it going into excess reserves. These surplus reserves, the difference between required reserves and total, now total a gigantic $US2.2 trillion and growing. When the economy resumes normal growth after the Age of Deleveraging is over, these excess reserves will spawn huge loans and money expansion, propelling the economy past full employment and into serious inflation. So the Fed's major job is to get rid of these excess reserves by selling securities. Tapering (adding more to this hoard) is just the start. (VIEW LINK)