history tells us that the powers that be are always too slow to react to the inflation genie. At some stage (don't know when!), the payment down of debt will be replaced by real earnings being ploughed into acquiring over priced assets, which in turn leads to higher wage demands. No doubt the Fed are watching this closely.
As a footnote, energy bills in Australia have gone up 70% since 2008. The public at large are struggling to pay these prices and I think the only reason there hasn't been a bigger outcry yet is because house equity has deteriorated as fast. My gut tells me we are going to see a more militant workforce demanding higher wages shortly, and this will be a signal that the inflation genie is out of the bottle. I can't imagine its much different in UK, US or Europe, frankly
