There is a growing list of educated people predicting the trillions of dollars spent by governments around the world to stimulate a moribund economy will not work.
There's already Peter Schiff, head of Euro Pacific Capital in Connecticut, and Peter Morici, professor at University of Maryland and former chief economist of the U.S. International Trade Commission. And you can add the name of Allan Brennan, manager of economic analysis and forecasting with the Alberta government's Department of Infrastructure and Transportation.
"Stimulus packages will not help the economy at all," Brennan said in a presentation with Dundee Private Investors branch manager Trevor Hamon. "A lot of money is going to banks, but unless you get that money to consumers, things will not improve."
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Brennan said that within a year, we will face a cataclysmic event that will shake world finances to the roots, leading to a major period of either deflation or hyperinflation, either of which will rock the global economy. Just what that event will be, he's not sure.
It could be the failure of eastern European countries, or the collapse of the American dollar. If it causes hyperinflation, investors can prosper by letting stock prices plummet for a couple of months, and then invest in commodities, with copper leading the rebound.
